Uganda is betting its oil future on the IEA's most controversial climate scenario

When a government reaches for a data point to justify a major infrastructure decision, the choice of which number to cite is rarely innocent. Uganda's oil planners have quietly anchored their fossil fuel ambitions to the International Energy Agency's NZE scenario — not the agency's net-zero pathway, but rather its most fossil-fuel-permissive outlook, a scenario that has found its most vocal champion in the Trump administration. The alignment is striking, and the consequences for Uganda's long-term economic planning could be severe.

The scenario in question, sometimes called the IEA's "Stated Policies" or a related high-fossil-fuel trajectory, essentially maps a world in which governments do little more than follow through on existing pledges, leaving enormous room for continued oil and gas expansion. Critics, including climate economists and energy transition analysts, argue that anchoring national investment decisions to this pathway is a form of optimism bias dressed up as data-driven policy. The IEA itself has been explicit since 2021 that no new oil and gas fields are needed if the world is to reach net zero by 2050. Uganda is, in effect, citing the agency while ignoring its headline conclusion.

Uganda's oil ambitions are not abstract. The country sits atop an estimated 6.5 billion barrels of crude in the Albertine Graben region, and the long-delayed East African Crude Oil Pipeline, a 1,443-kilometre project that would carry oil from western Uganda through Tanzania to the port of Tanga, has become a symbol of the country's development aspirations. The pipeline has faced sustained opposition from environmental groups and has struggled to attract financing from European banks wary of stranded-asset risk. Citing a scenario that projects robust long-term oil demand is, in this context, a financing and political argument as much as an analytical one.

The IEA publishes multiple scenarios precisely because the future is uncertain, but that multiplicity has become a political resource. The Trump administration's enthusiasm for the more permissive IEA pathways is not coincidental — it provides a multilateral veneer for a domestic agenda of fossil fuel expansion, allowing officials to say they are following respected international modelling rather than simply ignoring climate science. When Uganda adopts the same framing, it is plugging into a broader geopolitical current: a loose coalition of governments and interests that are using scenario selection as a form of soft climate denial.

The risk for Uganda is not merely reputational. Investors and development finance institutions are increasingly stress-testing projects against the IEA's net-zero scenario, not its most permissive one. A project that looks commercially viable in a high-fossil-fuel world can look like a stranded asset within a decade if energy transition accelerates faster than Uganda's planners are assuming. The country would be left with debt obligations tied to infrastructure that the global market no longer needs, a trap that several petrostates have already begun to feel closing around them.

There is also a domestic opportunity cost embedded in this choice. Every dollar of political capital and institutional energy spent defending the pipeline is a dollar not spent building out Uganda's considerable renewable potential. The country has significant geothermal, solar, and hydroelectric resources. The irony is that the same development logic Uganda is using to justify oil — the need to industrialise, to generate government revenue, to lift living standards — applies equally well to a renewables-led strategy that would not require Uganda to bet on a contested 30-year demand forecast.

The second-order consequence worth watching is what Uganda's framing does to the broader African conversation about energy development. Several other sub-Saharan nations with nascent fossil fuel ambitions are watching closely. If Uganda successfully uses a Trump-aligned IEA scenario to unlock financing and political support, it creates a template. The scenario-selection playbook could spread, making it harder for international institutions to hold a consistent line on fossil fuel financing in developing economies. The IEA, which has worked carefully to position itself as a credible voice for the energy transition, could find its own modelling weaponised against its stated conclusions in ways that are difficult to counter without appearing to restrict developing nations' choices.

The deeper structural tension here is one the international climate community has never fully resolved: the question of who gets to develop fossil fuels last, and on what terms. Uganda's planners are not wrong that wealthy nations industrialised on coal and oil. But the scenario they are citing was not designed to answer that moral question. It was designed to describe a world that most climate scientists consider a pathway to catastrophe. Building a national energy strategy on that foundation is not development planning. It is a wager on the world failing to act — and Uganda would not be the one paying the largest part of that bet.