U.S. oil output is poised to surpass Saudi Arabias in the next decade, making the worlds biggest fuel consumer almost self-reliant and putting it on track to become a net exporter, the International Energy Agency said.
Growing supplies of crude extracted through new technology including hydraulic fracturing of underground rock formations will transform the U.S. into the largest producer for about five years starting about 2020, the Paris-based adviser to 28 nations said today in its annual World Energy Outlook. The U.S. met 83 percent of its energy needs in the first six months of this year, according to the Energy Department in Washington.
The IEA outlook feeds into the idea of a shift in the center of influence in the world oil market, said Gareth Lewis-Davies, an analyst at BNP Paribas SA in London. Given Saudi Arabia is willing to shift production up and down it will retain a large degree of influence, and remain important as a price-influencer.
The U.S., whose crude imports have fallen 11 percent this year, is on track to produce the most oil since 1991, according to Energy Department data. In a year when Iran has threatened to halt oil shipments through the Persian Gulf, the growing output, coupled with a gas-production boom, may help insulate the nation from supply disruptions. President George W. Bush said in his 2006 State of the Union address that the U.S. needed to break its addiction to foreign oil.
Oil Prices
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