Global Investment in Data Centers Surpasses Oil Exploration in 2025
In a landmark shift reflecting the evolving priorities of the global economy, the International Energy Agency (IEA) reports that worldwide investment in data centers is projected to reach $580 billion in 2025, surpassing the $540 billion allocated for new oil supplies. ([techcrunch.com](https://techcrunch.com/2025/11/12/data-centers-now-attract-more-investment-than-finding-new-oil-supplies/?utm_source=openai)) This development underscores the increasing significance of digital infrastructure in today’s highly digitalized economies.
The surge in data center investments is largely driven by the rapid expansion of artificial intelligence (AI) technologies. Electricity consumption by AI-focused data centers is expected to quintuple by the end of the decade, effectively doubling the total energy usage of all data centers today. Traditional data centers are also anticipated to see increased energy consumption, though at a more moderate pace. ([techcrunch.com](https://techcrunch.com/2025/11/12/data-centers-now-attract-more-investment-than-finding-new-oil-supplies/?utm_source=openai))
Geographically, the United States is poised to account for approximately half of this escalating demand, with Europe and China contributing significantly to the remainder. The IEA notes that most new data centers are being developed in metropolitan areas with populations exceeding one million. Notably, half of these upcoming facilities are designed to have capacities of at least 200 megawatts and are often situated near existing data center clusters. ([techcrunch.com](https://techcrunch.com/2025/11/12/data-centers-now-attract-more-investment-than-finding-new-oil-supplies/?utm_source=openai))
This rapid expansion presents several challenges, particularly concerning energy infrastructure. The IEA highlights issues such as grid congestion and extended connection queues in various regions. For instance, in Northern Virginia, grid connection wait times can extend up to a decade, while Dublin has halted new interconnection requests until 2028. ([techcrunch.com](https://techcrunch.com/2025/11/12/data-centers-now-attract-more-investment-than-finding-new-oil-supplies/?utm_source=openai))
To address these challenges, companies like Amperesand and Heron Power are developing solid-state transformers. These advanced devices aim to integrate renewable energy sources more efficiently, respond swiftly to grid instabilities, and manage diverse energy conversions. However, widespread deployment of this technology is still a few years away. ([techcrunch.com](https://techcrunch.com/2025/11/12/data-centers-now-attract-more-investment-than-finding-new-oil-supplies/?utm_source=openai))
Looking ahead, the IEA anticipates that renewable energy sources will supply the majority of new data center power by 2035. Solar energy, in particular, has become increasingly cost-effective and is favored by developers. Over the next decade, approximately 400 terawatt-hours of electricity for data centers are expected to come from renewables, with natural gas providing around 220 terawatt-hours. If small modular nuclear reactors fulfill their potential, they could contribute an additional 190 terawatt-hours. ([techcrunch.com](https://techcrunch.com/2025/11/12/data-centers-now-attract-more-investment-than-finding-new-oil-supplies/?utm_source=openai))
This paradigm shift is also influencing traditional energy sectors. Major oilfield service companies such as SLB, Halliburton, and Baker Hughes are diversifying into AI infrastructure and data center services to offset declining demand in oil exploration. These firms are leveraging their expertise in energy and industrial technologies to meet the growing power needs driven by AI workloads. ([reuters.com](https://www.reuters.com/business/energy/oilfield-giants-pivot-booming-ai-infrastructure-drilling-demand-wanes-2025-10-27/?utm_source=openai))
In summary, the substantial investment in data centers over oil exploration signifies a transformative period in the global economy. As digital infrastructure becomes increasingly vital, addressing the associated energy challenges will be crucial to sustaining this growth.
