According to International Energy Agency (IEA), the United States will leave behind Saudi Arabia and Russia to become the world’s top oil producer in 2015. This development will enable the US to become almost self-sufficient reducing its dependency on OPEC supply. However, the IEA forecasts that by 2020, the oilfields of Texas and North Dakota will be past their peak output and the Middle East will resume its dominance – especially as a supplier to Asia.
As per International Energy Agency:
- A surge in shale oil production in the United States has reversed a reduction in its oil output and the IEA, adviser to industrialised nations, predicted in its 2012 World Energy Outlook the U.S. would surpass Riyadh as top producer in 2017.
- The surge in the oil output from Brazil, the dependence on Middle East oil in the next few years will be reduced.
- Oil prices would continue to increase prompting 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.
- By the mid-2020s, non-OPEC production will decline and nations in the Middle East mainly Organization of the Petroleum Exporting Countries (OPEC) will provide most of the increase in global supply.
- The Middle East will continue to be of central importance to fulfill the needs of the global oil industry mainly in Asia for many years to come.
- Currently, increasing U.S. tight oil production is helping to meet growing demand which is estimated to touch 101 million barrels per day (bpd) in 2035, up from 86.7 million bpd in 2011 and up slightly from 99.7 million bpd expected last year.
- Supply of Middle East oil will be crucial to the demands from China and India.
- China is expected to overtake the US as the largest oil-consuming country and Middle East oil consumption is likely to surpass that of the European Union, both around 2030.
- India is projected to become the largest single source of global oil demand growth after 2020.
What is Tight Oil?
Tight oil is petroleum that consists of light crude oil contained in petroleum-bearing formations of low permeability, often shale or tight sandstone. It is also called shale oil or Light Tight Oil (LTO). Tight oil should not be confused with oil shale, which is shale rich in kerogen.