IEA Forecasts Record $3.3 Trillion Global Energy Investment Amid 6% Oil Spending Decline

International energy investment will hit a historic peak of $3.3 trillion in 2025, spurred by rising spending on clean technology even as economic uncertainty looms.

Of this figure, $2.2 trillion will accrue to renewables, nuclear power, energy storage and grids—twice the amount going to fossil fuels. Solar photovoltaic alone will attract around $450 billion, and the spending on battery storage will rise to around $66 billion to meet the issues of intermittency.

On the other hand, upstream oil expenditure is projected to decline by 6% in 2025, the first decrease since the pandemic as weaker demand prospects and price pressures reduce spending.

This decline is a reflection of "economic uncertainties, reduced demand expectations and lower prices," resulting in deep reductions in U.S. tight oil spending and modest retrenchments by international majors.

Despite positive clean-energy financing, the IEA sees a persistent $400 billion yearly funding shortfall in investment in grid infrastructure. Filling this gap by the early 2030s will be essential to add new capacity and ensure electricity security.