“The United States is projected to become the largest global oil producer (emphasis added) before 2020.” The International Energy Agency’s 2012 World Energy Outlook Report.
Let that sink in for a minute.
The predictions in the IEA report are stunning. The United States will actually pass Saudi Arabia in oil production in a few years, and stay ahead of the oil-rich country for a time.
Our country, which has been a net petroleum importer for the last 60 years, is in the early stages of a paradigm shift in world energy production that should secure the country’s energy needs and be a boon to the economy.
“The United States, which currently imports about 20 percent of its total energy needs, becomes all but self-sufficient in net terms by 2035, a dramatic reversal of the trend seen in most other energy-importing countries,” according to the just-released report.
There are several reasons for the remarkable shift.
At the top of the list is the production of oil and natural gas from shale. Hydraulic fracturing allows producers to free-up vast amounts of oil and gas trapped in deep shale formations that were previously unreachable.
Additionally, the United States is becoming more energy efficient. Our demands for energy continue to rise, but not as fast because of efficiencies, particularly in transportation.
The IEA says the gas and oil developments mean the United States is enjoying an energy renaissance that is “redrawing the global energy map.”
None of this means that the United States will become an energy island. The markets for oil, natural gas and coal are global. We will still be susceptible to price fluctuations, but our increased domestic production means greater energy security.
Additionally, the IEA reports that coal and nuclear energy face uncertain futures.
Coal demand, while off in the U.S. because of lower natural gas prices and regulatory pressure, could remain strong in China and India. But the IEA says whether coal consumption continues to rise depends on policy measures that favor lower emission sources.
And the role of nuclear power will likely continue to be diminished. The IEA says the 2011 accident at the Fukushima nuclear power plant in Japan has dampened interest in expanding nuclear capacity.
Projections about future energy production are notoriously fickle. As the Wall Street Journal points out, “Four years ago, the perception of energy scarcity and rising concern about global warming led Mr. Obama to push for legislation capping greenhouse gas emissions and to pump billions of federal dollars into green-energy companies.”
Now, we’re facing a boom of natural gas and oil, while carbon emissions from energy consumption are declining in this country.
Still, the IEA report, which coincides with other studies of the global energy picture, bodes well for the United States… at least for now.