U.S. to overtake Saudi Arabia in oil production

The United States will become the largest global oil producer by 2020, overtaking Saudi Arabia, the International Energy Agency said Monday.

U.S. oil imports will fall as North America emerges as a net oil exporter around 2030, according to World Energy Outlook, a report released by the agency Monday. That will accelerate a directional shift of international oil trade, with nearly 90 percent of Middle Eastern oil exports being drawn to Asia by 2035.

The United States also will become a net exporter of natural gas by 2020 and will be “almost” self-sufficient in energy by 2035.

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“North America is at the forefront of a sweeping transformation in oil and gas production that will affect all regions of the world, yet the potential also exists for a similarly transformative shift in global energy efficiency,´ said IEA Executive Director Maria van der Hoeven.

The report forecasts global energy demand to rise by a third in 2035. China, India and the Middle East will account for 60 percent of that growth.

Fossil fuels will remain dominant in the global energy mix, with Iraq accounting for 45 percent of the growth in global oil production to 2035. The country will become the second-largest global oil exporter, overtaking Russia.

Demand for natural gas will increase 50 percent in 2035. Nearly half of the increase in production to 2035 will come from unconventional gas, including the use of hydraulic fracturing, and mostly from the United States, Australia and China.

Global coal demand will surge 21 percent. Renewables, however, will become the world’s second-largest source of power generation by 2015 and will close in on coal as the primary source by 2035.

The increase in renewables will hinge “critically” on continued subsidies. At the same time, greater efforts to achieve energy efficiency would cut the growth in global energy demand by half, according to the report.