Oil giant BP (NYSE:BP) has released its latest energy outlook. The report outlines three different scenarios, which forecast energy demand through 2050: Rapid, net-zero, and business-as-usual.

Among the major takeaways is that "renewable energy will play an increasingly important role in meeting the world's growing energy needs." Meanwhile, "oil and gas – while remaining needed for decades – will be increasingly challenged as society shifts away from its reliance on fossil fuels."

A red sky behind several oil pumps.

Image source: Getty Images.

Because of that view, even in the company's "business-as-usual" scenario, it sees oil demand having peaked after steadily rising for decades. At best, BP sees consumption leveling off over the next decade before slowly declining. However, this scenario does have natural gas demand continuing to increase through 2050.

The two other scenarios BP contemplates provide an even more dire outlook for oil, with both predicting that demand will decline over the next several decades. Under a rapid scenario, consumption would fall below 50 million barrels per day by 2050, a roughly 50% decline from the current level. Meanwhile, the net-zero view has consumption approaching 20 million barrels per day within 30 years. Similarly, BP sees natural gas demand declining by 2050 in both scenarios, though the rapid scenario predicts consumption growth through the next decade.

BP's energy outlook aligns with its revamped approach to capital allocation, which the company unveiled earlier this year. That new strategy will see BP reduce its investments in oil and gas production and shift that capital toward low-carbon energy sources. A a result, BP expects to increase its annual investments from $500 million per year up to $5 billion by 2030. Under that plan, BP's oil output would decline by 40% from its 2019 level, while the company would increase its renewable energy generating capacity 20-fold by 2030.