Data Center Spending Now Surpasses Oil

Where did the money go first?

In the 2025 energy ledger, there is a striking contrast: global data center-related investment stands at approximately $580 billion, exceeding the roughly $540 billion in global oil supply investment. According to the flagship report World Energy Outlook 2025, these figures correspond to a capital expenditure comparison table.

This contrast is easily misinterpreted as a sign that oil is no longer important. The picture painted by the report is more nuanced: oil and gas remain at the heart of the energy security narrative, LNG continues to grow, and since 2015, the growth rate of LNG consumption has been twice that of overall natural gas consumption. However, when it comes to the direction of new investments, capital has already begun to flow more directly into data centers, power systems, and the infrastructure underpinning computing power.

Why will it surpass oil?

The reason cannot be reduced to the simplistic notion that all new global electricity demand comes from data centers. More accurately, the demand for computing power has elevated a category of spending—once largely confined to the internet sector—to the scale of energy infrastructure. Data centers require purchasing land, constructing facilities, deploying servers, connecting to the grid, and securing power supplies. When the cumulative cost of these activities is placed side by side with traditional energy supply investments on the same ledger, it is only then that the $580 billion figure overtakes the $540 billion mark.

This also explains why the “Era of Electricity” is not merely an abstract term. In the past, discussions on energy security often focused on oil fields, pipelines, LNG carriers, and refineries; now, the same category of security concerns is extending to substations, transmission lines, backup power supplies, and data center power supply contracts. The shift in capital expenditure shows that enterprises and governments are voting with their wallets for future demand.

Another key pillar in the report is the electrification of transportation. By 2035, under the Stated Policies Scenario, electric vehicles will account for approximately 50% of sales across all vehicle categories. This means that a portion of energy consumption will shift from gas stations to charging networks and grid loads. Data centers are not the sole major driver of electricity consumption, but alongside electric vehicles and industrial electrification, they are increasingly pushing incremental energy demand toward the power system.

Oil has not disappeared.

The most common misconception arising from this recent overtaking is interpreting the shift in investment as a complete change of guard in the energy sector. The evidence does not support this judgment. LNG consumption has grown at an even faster pace since 2015, indicating that the oil and gas system is still expanding and adjusting, and that traditional energy security continues to influence prices, trade, and supply stability.

What has truly changed is the focus of marginal capital expenditure. Investment in oil supply remains on the order of $540 billion, while data center-related investment has already reached $580 billion. This gap is not large, yet it is enough to shift the lens through which we observe the energy system: when assessing future energy security, we cannot look solely at underground resources and maritime routes; we must also consider whether the power grid can accommodate the additional load.

The Age of Electricity Has Its Bottlenecks Too

Investing in data centers does not mean that power infrastructure will automatically materialize. Power-related expansion will also face critical mineral supply chain risks. Minerals, equipment, transformers, grid access, and construction cycles could all become constraints on the expansion of computing power.

This is also another layer of meaning behind the $580 billion figure. It is not merely the cost of buying servers, but a comprehensive set of expenditures required to translate computing demand into real-world power supply capacity. The larger the data center, the greater the need for a stable, predictable, and long-term power supply; and the tighter the power system, the more new projects will be affected by grid interconnection, queuing, and supply chain constraints.

Therefore, this overtaking does not herald the “end of the oil age”; rather, it demonstrates that the dimensions of energy security have multiplied. Oil and gas remain, but power infrastructure is beginning to capture a larger share of new investment; meanwhile, the demand for computing power has brought power grids, data centers, and supply chains from the back office to the forefront. In other words, the focus of energy security has expanded from fuel supply to power delivery capacity, and whoever can connect, dispatch, and provide stable power more quickly will also shape the next wave of industrial expansion.

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Source institutions：International Energy Agency

This content is for reading and understanding research reports. It does not constitute investment advice or trading signals.