US to become world’s top oil producer in 2015: IEA

The International Energy Agency (IEA) has said that the United States will overtake Saudi Arabia and Russia as the world’s top oil producer by 2016. However, according to the IEA, the West’s energy agency, by 2029, the oilfields in Texas and North Dakota will be past their prime and the Middle East will regain its dominance, particularly as a supplier to Asia.

The surge in shale oil production in the US has reversed a decline in its oil output. Although the IEA originally predicted that the States would surpass Riyadh in 2017, it has revised this forecast, stating that the re-ordering will happen earlier than expected.

According to IEA Chief Economist, Fatih Birol:

“We expect in 2015 the U.S. to be the largest oil producer in the world. We see two chapters in the oil markets. Up to 2020, we expect the light, tight oil to increase – I would call it a surge. And due to the increase coming from Brazil, the need for Middle East oil in the next few years will definitely be less. But due to the limited resource base (of U.S. tight oil), it is going to plateau and decline. After 2020 there will be a major dominance of Middle East oil.”

The IEA also said that oil prices would continue to rise and spur development of unconventional resources such as the light, tight oil that has fueled the U.S. oil boom, oil sands in Canada, deepwater production in Brazil and natural gas liquids.

 

Read more at: http://news.msn.com/world/us-to-become-worlds-top-oil-producer-in-2015-iea

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3 thoughts on “US to become world’s top oil producer in 2015: IEA

  1. Pingback: IEA findings: Financial Times and theoilandgasworld analysis | theoilandgasworld

    • You are right, much of the analysis suggests it is going to be short-lived (I gave an insight from the Financial Times in a blog posting above ). I’m not convinced, although that doesn’t mean I think the US has found a long term solution. What it does show is that the US is seriously looking to move away from its dependence on Middle East oil and invest in its own economy. The US oil majors are not happy just feed off Middle East oil until the wells runs dry – they are being proactive, which is a worrying sign for the Middle East.

      Rightly or wrongly, the oil industry’s first concern is making money and the oil majors clearly think shale gas is a worthy cause. I think it’s safe to assume they wouldn’t bother unless they thought moving away from the Middle East and investing in shale was going to be profitable.

      That doesn’t mean that the Middle East oil industry is dead, far from it, but I do think that its best days are behind it.

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