Published on February 11, 2014
The US has come extremely close to accomplishing previously unthinkable energy self-sufficiency. US is expected to overtake Saudi Arabia and Russia as the world’s top oil producer by 2017.
There has been a considerable decline in US oil imports. North America will likely become a net oil exporter by 2030 and the US will succeed in becoming almost self-sufficient in energy by 2035. Currently, US imports nearly 20 per cent of its total energy needs. However, the coming years are going to witness a dramatic change in the trend seen in most energy importing countries.
The forecasts made by the International Energy Agency (IEA) are in contrast to its earlier reports. The IEA had reported the Saudi Arabia will continue to remain the top producer till 2035. However, now the IEA states that the energy developments in the US are remarkable and that their impact will be felt beyond North America and the energy sector.
The shale revolution in US, the expanding oil and gas production, accelerated by upstream technologies is boosting the economy. The less expensive gas and electricity prices have provided the industry with a competitive edge. IEA believes that US will overtake Russia as the biggest gas producer by 2015.
US is expected to become the world’s largest oil producer by 2017, which could have major political implications if Washington decides that its strategic interests are no longer rooted in the Middle East and other oil producing areas. The question that remains is that whether an energy independent US would still consider safeguarding key trade routes around the world, such as the Strait of Hormuz in the Middle East.
By 2035, US will be more reliant on natural gas as cheap domestic supply will improve demand among industry and power generators. The IEA forecasts are significantly optimistic considering that the shale oil boom is a new phenomenon.
Saudi Arabia can become the number one producer again, provided no new resources are discovered after 2020 and if the prices are not as high as today.
IEA is of the opinion that the US oil production will rise to 10 million barrels per day by 2015 and 11.1 mbpd in 2020 before declining to 9.2 mbpd levels by 2035. Saudi Arabia, on the other hand, will reach 10.9 mbpd levels by 2015, 10.6 mbpd in 2020 and then rise to 12.3 mbpd by 2035.
