LONDON--America's climb to become the world's largest energy
producer is expected to shrink the market for global oil and
natural gas trade, with Europe and Asia set to be the only two
major oil and gas importing regions by 2035, BP PLC (BP) said in
its annual energy forecast Wednesday.
BP's closely watched forecast underscores how the development of
shale, or "tight," oil and gas reserves promise to confound
long-held assumptions about the global flow of energy over the next
20 years. For decades, the energy industry has structured itself
around feeding the U.S., the world's largest importer of crude.
But booming oil output there is now sharply cutting crude
imports, though they still account for a sizeable chunk of U.S.
consumption and will for some time to come. Forecasters expect the
U.S. to soon pass Russia as the world's top energy
producer--lumping in both oil and gas--if it hasn't already done
so.
"The big story of course is the continuation of tight oil
production in the U.S.," BP's chief economist Cristof Ruehl said
Wednesday.
"Out from literally nowhere a few years ago," tight oil output
globally will account for 7% of liquids production by 2035, with
other regions led by Russia and South America joining the boom, Mr.
Ruehl said.
BP's projections contrast with that of other
forecasts--including those by the Organization of Petroleum
Exporting Countries--that the industry's success in exploiting
shale oil is unlikely to be repeated outside the U.S. High
depletion rates for tight oil and gas production could also mean
America's shale oil bonanza could be relatively short-lived and may
have only limited impact in the long-run, some skeptics say.
Although BP expects the rapid pace of growth from tight-oil
production in the U.S. to slow, it forecasts that America will have
become self-sufficient in supplying its own energy needs by 2035,
though oil users there will still likely elect to import some oil.
At the end of that period, the U.S. will be the second-largest
exporter of liquefied natural gas on the planet, behind Australia,
and its oil imports will have dwindled to just one million barrels
a day, from a peak of over 12 million barrels a day in 2005.
The result will be a major shift in trading patterns, BP
forecasts.
"Energy imports for everything, in particular oil and gas,
become very concentrated in Asia--which expands its imports
dramatically--and in Europe," BP's Mr. Ruehl said. Meanwhile, "the
exporting regions become a lot more competitive," he said.
OPEC, in particular, will face pressure to reduce its oil output
to stabilize markets and prices in the face of rapid production
growth elsewhere. By 2018, OPEC, a cartel of some of the world's
largest oil producers, is expected to have a supply buffer of 6
million barrels a day. That's spare production capacity that can be
quickly turned on.
OPEC members like Nigeria and Algeria have already seen their
oil exports to the U.S. dwindle over the last few years, forcing
those countries to seek new markets in Asia and Europe.
BP forecast overall global energy demand will grow 41% between
2012 and 2035, slowing down from a 52% surge in
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