Since the publication of McKinsey’s previous Global Energy Perspective in 2025, the world’s energy system has once again weathered unexpected storms that impact both its near-term outlook and long-term trajectory. Energy-related shocks are increasingly global shocks, with “gray swan” events observed in recent years—the closing of the Strait of Hormuz, the Russia–Ukraine war, and the COVID-19 pandemic—having severe impacts on energy availability, demand, and prices.1 As a result, we have revised our bottom-up energy model and shifted the focus of this year’s report to a broader energy-system view that explores affordability and security, alongside decarbonization.
The Global Energy Perspective 2026 presents a new set of scenarios that reflect the global energy system with all its uncertainty and complexity. Executives can use these scenarios for strategy management to help them decide which bets to make now, which options to preserve, and which signals could justify changing course.
Highlights from this year’s analysis:
- The energy transition has become an energy expansion. In 2025, global energy demand grew 2.7 percent, with oil, gas, coal, and renewables all expanding simultaneously. Across nearly every scenario, energy demand continues to grow, with the central question increasingly being what will supply that growth?
- Geopolitical fragmentation could add a material risk premium to energy. In the event of a fragmentation scenario—Fragmented Energy Order—rebuilding concentrated supply chains outside China could raise solar capital expenditure by 20 to 25 percent, and battery-storage capital expenditure by 40 to 50 percent in the European Union and the United States. Trade friction could also raise fuel costs through longer routes, higher insurance costs, and reduced trading flexibility, making geopolitics an increasingly important component of energy economics.
- Artificial intelligence is the biggest growth segment but the post-2030 demand picture remains highly uncertain. While data centers are the fastest-growing load segment in OECD power markets, with electricity demand projected to grow at a 24 percent CAGR through 2030 in the Continued Momentum baseline scenario, the pipeline beyond that timeframe becomes highly uncertain and could be dampened by efficiency breakthroughs in computing power.
- The grid is the energy transition’s ultimate speed limit. The world will require more energy, and a disproportionate amount of that demand growth comes from electricity. Transmission, storage, firm capacity, permitting, and interconnection now determine how quickly low-cost generation becomes reliable, usable energy. Across all scenarios, infrastructure readiness is already the most common binding constraint. When it lags behind, electrification stalls, regardless of how cheap renewables become.
- The next energy crisis is as likely to be driven by equipment, labor, batteries, or critical minerals as it is by barrels of oil. An increasingly electrified and digitized energy system introduces critical dependencies across equipment, minerals, semiconductors, ports, grids, and digital infrastructure. Energy security is now a system-architecture challenge, not simply a fuel-diversification challenge.
- In a high-growth world, oil demand could reach nearly 130 million barrels per day by 2035—a 30 percent increase from today. In the Hydrocarbon Resilience scenario, oil demand is projected to grow by more than 2.5 million barrels per day annually over the next decade—roughly twice the growth rate of the previous decade. This underscores the risk of underinvestment if companies plan exclusively around an early peak in oil demand.
- Nuclear returns as a major source of firm, low-carbon power in the Decarbonization Delivers scenario. Average annual net nuclear additions more than double through 2050 in this scenario, from 18 gigawatts to 40 gigawatts, as nuclear costs decline, timelines improve, and small module reactors move from first-of-a-kind projects toward repeatable deployment. With most nuclear OEMs likely to be from Asia in the latter half of this century, the center of gravity for new energy technology may continue to shift East.2 Rising demand and the need for reliable 24/7 supply strengthen the strategic role of nuclear power alongside renewables.
- Cheaper generation may not mean cheaper energy—the total system cost increasingly matters. Global transmission and distribution investment is projected to rise from $443 billion in 2025 to $970 billion annually by 2050, partially offsetting falling generation costs. Energy-system economics increasingly depend on the entire system—generation, grids, storage, firm capacity, flexibility, and integration—not on the levelized cost of electricity alone.
- All scenarios project a widening gap to the Paris Agreement-aligned 1.5°C warming trajectory. The current focus on energy affordability and security leaves the world on a concerning pathway toward intensifying temperature increases. Even Decarbonization Delivers—the most optimistic high-growth scenario in this year’s report—misses the Paris Agreement target by a projected 0.8°C.
- There is no single “most likely” energy scenario—the range of plausible outcomes has widened dramatically, increasing the need for executives to take a stance. While scenarios help executive teams understand the possible evolution of the global energy system, this insight needs to be translated into an organizational point of view on which future is most likely to unfold if executive teams are to avoid decision paralysis. Scenario planning, while critical, is not a substitute for strategic action.
Read the full 2026 report here.
1 The Strait of Hormuz crisis affected a larger share of global energy than any other disruption in the last century.
2 The path to a new era for nuclear energy, International Energy Agency, January 2025.