U.S. seen overtaking Saudis as biggest oil producer
The United States will become the world's largest oil producer by around 2020, temporarily overtaking Saudi Arabia, as new exploration technologies help find more resources, the International Energy Agency forecast on Monday.
In its World Energy Outlook, the energy watchdog also predicted that greater oil and natural gas production — thanks partly to a boom in shale gas output — as well as more efficient use of energy will allow the U.S., which now imports around 20 percent of its energy needs, to become nearly self-sufficient around 2035.
That is "a dramatic reversal of the trend seen in most other energy-importing countries," the Paris-based IEA said in its report. "Energy developments in the United States are profound and their effect will be felt well beyond North America — and the energy sector."
Rebounding U.S. oil and gas production is "steadily changing the role of North America in global energy trade," the IEA said.
For example, oil exports out of the Mideast will increasingly go to Asia as the U.S. becomes more self-sufficient. That will increase the global focus on the security of strategic routes that bring Middle East oil to Asian markets. Tensions between Iran and Western powers have raised concerns that oil exports from the Persian Gulf could be blocked in a potential conflict over Tehran's alleged plan to develop nuclear weapons.
The IEA added that global trends in the energy markets will be influenced by some countries' retreat from nuclear power, the fast spread of wind and solar technologies and a rise in unconventional gas production.
The agency concluded that despite the rising use of low carbon energy sources, huge subsidies will keep fossil fuels "dominant in the global energy mix."
"Taking all new developments and policies into account, the world is still failing to put the global energy system onto a more sustainable path," the IEA said.
Global energy needs are forecast to increase by a third by 2035, with 60 percent of the additional demand coming from China, India and the Middle East.
In its World Energy Outlook, the energy watchdog also predicted that greater oil and natural gas production — thanks partly to a boom in shale gas output — as well as more efficient use of energy will allow the U.S., which now imports around 20 percent of its energy needs, to become nearly self-sufficient around 2035.
That is "a dramatic reversal of the trend seen in most other energy-importing countries," the Paris-based IEA said in its report. "Energy developments in the United States are profound and their effect will be felt well beyond North America — and the energy sector."
Rebounding U.S. oil and gas production is "steadily changing the role of North America in global energy trade," the IEA said.
For example, oil exports out of the Mideast will increasingly go to Asia as the U.S. becomes more self-sufficient. That will increase the global focus on the security of strategic routes that bring Middle East oil to Asian markets. Tensions between Iran and Western powers have raised concerns that oil exports from the Persian Gulf could be blocked in a potential conflict over Tehran's alleged plan to develop nuclear weapons.
The IEA added that global trends in the energy markets will be influenced by some countries' retreat from nuclear power, the fast spread of wind and solar technologies and a rise in unconventional gas production.
The agency concluded that despite the rising use of low carbon energy sources, huge subsidies will keep fossil fuels "dominant in the global energy mix."
"Taking all new developments and policies into account, the world is still failing to put the global energy system onto a more sustainable path," the IEA said.
Global energy needs are forecast to increase by a third by 2035, with 60 percent of the additional demand coming from China, India and the Middle East.
Can't be.  Must be a lie.  After all, the liberal experts said we would be out of oil in the US by 2020 and needed to have electric cars.  Oh, the Cheney started the wars because of oil no longer being in America.  I believed them.
Â
Do I have to change my thinking again?
We import 20% of our energy which include Canada, Mexico, etc. So, why the price of oil and gas fluctuate so much from tensions in the Middle East or Nigeria? So, if we are 100% self sufficient are we going to see stabilization in supply? Probably not.
@STK Because the price of gas at the pump is driven by global futures investors who are betting on worldwide supply and demand.
By the time 2020 rolls around we are still fossil fuel dependent for energy use, we are screwed.
Yup. A growing number of studies are showing the US will be energy independent or darn close to it by 2025 to 2035. A combination of new technology allowing better extraction, but far more important, growing conservation through more efficient appliances, cars and trucks, aircraft, and electronics are reducing our consumption. A little know challenge George W. Bush made in his 2007 State of the Union address (never thought I would be calling out GWB in the positive) was 10 in 20. Reduce our energy consumption by 10% by 2020. That's already been achieved, and another 10% on top of that. It has less to do with the recession and much more to do with improved efficiencies.
Â
It is projected that we could be North American only capable for imports by as early as 2020. That is trading only with Mexico and Canada for imports of fuels. As it is our largest net export as a county is refined fuel (gas, diesel, aviation) - over 753 million barrels EXPORTED last year.
Â
The whole situation is rather sad - because not a single special interest will blink in celebrating the huge work as a nation we've done to date.
Â
The greenies cry it's not enough (even though more and more studies show we are moving faster than even the best projections toward reducing our energy consumption another full 40% by 2020 to 2025). They'll have you think we're still a nation of Hummer driving 8 MPG thermostat set to 75 nation - that just isn't the case.
Â
The drill baby drill crowd won't admit that there really is no need to be punching holes in the North Slope with our improvements in local technology and growing efficencies through basic conservation and relatively minor changes like direct injection in engines, more efficient turbine engines in jet aircraft, smarter logistics for overall shipping, and other really simple ideas like turning the thermostat down in the winter, up in the summer, and lowering the wattage of light bulbs (I'll give CFC light bulbs credit but I hate the damn things and I think they are an environmental time bomb as mercury contamination in landfills becomes a bigger issue). Also due to dramatically increased recycling - we're using less.
Â
The Tea Party would have you think that we don't have enough refineries, even though it is our largest net export as a nation, and will run out of energy next week if we don't put a well in everyone's front yard.
Â
The reality is that every person who has a dog in this fight has something to cheer about. The drill baby drill crowd can certainly celebrate the drill baby drill activity in places like North Dakota (what is the long term cost, to be determined).
Â
The greenies can truly celebrate a 20% reduction in energy use as a nation from 2005 to 2012. Just seven years netted a 20% reduction. That is HUGE - and it hasn't impacted our standard of living or productivity.
Â
The only real losers I see in all of this is the "clean coal" people because we really don't need to be tapping that resource at a bigger level to reach independence.
Â
Actually, we don't have to do a whole lot more - continue to squeeze more out of each drop of energy (which we are doing) and tap our current resources.
Â
I think we could achieve full energy independence even faster if our government would push instead of electric cars, which aren't ready for prime time (and ironically the Chevrolet Volt is rising to the top of the pack with the best answer) and instead providing incentives to convert vehicles to CNG. The engine conversion is actually very simple, but the cost is very high (about $10K per vehicle) so it is very hard to justify/monetize.
 @Howard Beale I recently read about a company that has a catalyst to turn natural gas into liquid fuel, plastics...looks good. Vulcan is involved.
 @Howard Beale Google.  The last refinery built in the United States was in 1988.
Â
Still driving your 1988 car? Â If you were, would it need a new frame due to metal fatigue? Â A new motor? Â You get the idea don't you, that we are limited because of the finite number of refineries inside America and their age, don't you?
Â
If nothing else, if you don't want to increase the number, how about replacing the oldest one built in the 1860's. Â yeah, not a typo. Â Philadelphia. Â Two of the nine are being shut down due to age.
 @sentryone This is a strawman argument - at best. Cars are not built to same standards as industrial infrastructure. My last house was built in 1958 - as are many homes around here (and much older). With standard care and maintainence they remain perfectly good dwellings. for middle class families. You can improve them with updates, expansions, and repairs.
Â
If I follow your 1988 standard than just about every mile of highway, every bridge, every school, every power line in this country is a failure ready to happen. There have been massive updates to our refinery infrastructure to improve output, reduce waste and byproducts, and accelerate product transition. We have no shortage in this country of petrochemical refining capacity. Again, our largest net export is refined fuel, diesel, aviation and gasoline. 753 million barrels in 2011. That's almost 11 billion gallons. That is over 34 BILLION gallons of crude refined, and then exported!
Â
We do have a shortage or refining for fuel additives for clean air standards, largely ethanol. There is a huge fight going on to prevent changing the standard from E-10 to E-15, and I hope we never go to E-15. Personally I HATE, LOATHE, DESPISE E-10. It reduces MPG for starters, a good 10% and it is not good on fuel systems of older cars and trucks.
Â
And consider this - with rapidly shrinking demand (again, we've dropped consumption by 20% in just 7 years) it is very hard for the oil and gas industry to justify massive refinery capacity expansion to their own shareholders. If anything, export for profit will only grow. Sure that provides short term gain to balance sheets of largely global oil companies - but it means were selling our natural resources on the international market for pennies on the dollar. That policy will eventually catch up to us.