Crude production is set to continue expanding in the United States thanks to shale oil, with the country becoming a net exporter from 2021, a development which should reinforce global energy security, the IEA said Monday.
New technology that allows for extracting oil and gas from shale rock formations has led to a boom in oil production in the United States in recent years. With low production costs, that boom is set to continue.
The IEA forecasts the United States will account for two-thirds of the increase in global oil production and some three-quarters of the expansion of liquefied natural gas (LNG) over the next five years.
"This will shake up international oil and gas trade flows, with profound implications for the geopolitics of energy," said Birol.
Production outside the OPEC oil cartel is set to continue rising, according to the IEA, which sees it climbing by 6.1 million barrels per day (mbd) to 68.7 mbd in 2024. In addition to the United States, both Brazil and Norway are expected to increase output.
Meanwhile, OPEC output is expected to dip in 2019 and 2020, before resuming modest growth to 32 mbd in 2024.
The IEA also sees growth in demand for oil to ease, in particular due to slowing expansion in China. Nevertheless, it sees demand increasing by an annual average of 1.2 mbd to 2024.
Moreover, the IEA continues to see no peak in oil demand.
The petrochemicals sector and jet fuel will be the key drivers of growth, "more than offsetting a slowdown in gasoline due to efficiency gains and electric cars", said the IEA.
(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)