Forecasts by the International Energy Agency (IEA) on Monday said the United States will overtake Saudi Arabia and Russia as the world’s top oil producer by 2017.
The Paris-based energy organisation predicted that Washington will come very close to achieving a previously unthinkable energy self-sufficiency.
The latest report comes in stark contrast to previous IEA reports, which said Saudi Arabia will remain the top producer until 2035.
“Energy developments in the United States are profound and their effect will be felt well beyond North America – and the energy sector,” the IEA’s annual long-term report said in one of the most optimistic forecasts made for US energy production growth to date.
“The recent rebound in US oil and gas production, driven by upstream technologies that are unlocking light tight oil and shale gas resources, is spurring economic activity – with less expensive gas and electricity prices giving industry a competitive edge,” it added.
The findings also suggested that the United States will become almost self-sufficient in energy by 2035 as its oil imports continue to decline.
“The United States, which currently imports around 20 percent of its total energy needs, becomes all but self-sufficient in net terms – a dramatic reversal of the trend seen in most other energy importing countries,” it said.
Addressing a news conference in London, the IEA Chief Economist Fatih Birol said US would overtake Russia as the biggest gas producer by a significant margin by 2015 while adding that it would become the world’s largest oil producer by 2017.
IEA projections showed Washington will rely more on natural gas than either oil or coal by 2035 thanks to a boost in demand for industry and power generators.
The IEA’s chief economist admitted that the agency’s forecasts are very optimistic given the recent boom in shale oil.
“Light, tight oil resources are poorly known … If no new resources are discovered (after 2020) and plus, if the prices are not as high as today, then we may see Saudi Arabia coming back and being the first producer again,” he said.
The IEA said US oil production will rise to 10 million barrels per day (bpd) by 2015 and 11.1 million bpd in 2020 before dipping to 9.2 million bpd by 2035.
On the other hand, Saudi oil output would be 10.9 million bpd by 2015, 10.6 million bpd in 2020 but would rise to 12.3 million bpd by 2035, the IEA findings suggested.
Russian, which over the past decade kept its oil output above Saudi Arabia, is expected to produce over 10 million bpd until 2020, when it will start to decline to reach just above 9 million bpd by 2035.
The IEA also predicted that by 2035, almost 90% of oil from the Middle East would be drawn to Asia.