IEA report: U.S. now world leader in oil, gas

By Luke Geiver | November 14, 2017

The U.S. is turning into the undisputed global leader for oil and gas, according to the International Energy Agency’s 2017 World Energy Outlook report released this week. The new crown for the U.S. is directly linked to the development of unconventional oil and gas from shale plays across the country. From 2010 to 2025, the U.S. will match the highest sustained oil output growth level by a single country in the history of oil markets, the IEA said. And, the amount of shale gas produced in the country will far surpass any number previously recorded for such markets.

“Expansion on this scale is having wide-ranging impacts within North America, fueling major investments in petrochemicals and other energy-intensive industries. It is also reordering international trade flows and challenging incumbent suppliers and business models,” IEA said.

The rise of U.S. to the top of the oil and gas export hierarchy will not be impacted by a rise in—or shift too—passenger transport via electric vehicle. Although EV’s are expected to rise in use in most countries over the next 20 years, the need for oil-based fuels in the trucking, shipping and aviation markets will help to continue the increase in demand for oil, IEA said.

The role of U.S. shale has also marked a shift in world energy markets that will last well into the future. The old ways of understanding the world of energy are losing value as countries change roles, IEA said in its report. As an example, the Middle East is fast becoming a major energy consumer and the U.S. a major exporter.

The change in energy primary energy demand is also shifting around the world. For many countries, the demand for energy measured in million tons of oil equivalent (Mtoe) is rising. Between the period of 2016 to 2040, India’s energy demand will rise by 1005 Mtoe. China will increase to 790 Mtoe, Africa by 485 Mtoe, Southeast Asia at 420 Mtoe and Central and South America will reach 270 Mtoe. The U.S. however, is one of three major countries that will actually show a decrease in energy demand. The U.S. will show a negative 30 Mtoe in primary energy demand, as will Europe (-200 Mtoe) and Japan (-50 Mtoe).

The future of electricity is best seen in India and China, the report shows. By 2040, India will add the equivalent of today’s European Union to its electricity generation and China will add the equivalent of today’s United States.

Asia will also be largely fueled by LNG in the future, which could be met in large part by the U.S.

To view more on the report, click here.