The US will overtake Saudi Arabia and Russia to become the largest global oil producer by 2020.
That’s because of a continued fall in US oil imports, according to the International Energy Agency (IEA) in its ‘World Energy Outlook 2012’ report. It predicted the drop in imports could also make North America a net oil exporter around 2030, which would mean a “sea-change” in the direction of international oil trade, with almost 90% of Middle Eastern oil exports being drawn to Asia by 2035.
Maria van der Hoeven, IEA’s Executive Director said: “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.”
The report also presented the results of an ‘Efficient World Scenario’, which showed what energy efficiency improvements can be achieved simply by adopting measures “that are justified in economic terms”. IEA predicted more efforts on efficiency could cut the growth in global energy demand by half but due to the “disappointingly slow progress in global energy efficiency” over the last decade, the potential would not be realised.
Faith Birol, IEA’s Chief Economist and the report’s lead author said: “Our analysis shows that in the absence of a concerted policy push, two-thirds of the economically viable potential to improve energy efficiency will remain unrealised through to 2035. Action to improve energy efficiency could delay the complete ‘lock-in’ of the allowable emissions of carbon dioxide under a 2ºC trajectory – which is currently set to happen in 2017 – until 2022, buying time to secure a much-needed global climate agreement. It would also bring substantial energy security and economic benefits, including cutting fuel bills by 20% on average.”
The report also suggested fossil fuels would remain dominant in the global energy mix, supported by subsidies, which jumped by almost 30% to $523 billion (£329.4 billion). Global oil demand is expected to grow by 7 million barrels a day (mb/d) to 2020 and exceed 99 mb/d in 2035. Iraq would account to 45% of the growth in global oil production to 2035, becoming the second-largest oil exporter in the world.
Renewables are expected to account for almost one-third of the total electricity output by 2035, with the most growth in solar power. It is also predicted to be the world’s second-largest source of power generation by 2015, with coal as the primary source of global electricity by 2035.
Global energy demand could grow by more than one-third by 2035, with China, India and the Middle East accounting for 60% of the increase.