The US will drive oil supply growth in the next 5 years

The US will drive oil supply growth in the next 5 years

Rita Lofano
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According to IEA, the United States will become a net oil exporter in 2021, with exports of oil and derivatives exceeding imports by the end of 2024, overtaking Russia and closing in on Saudi Arabia. The second day of the maxi conference in Houston

The United States will drive global oil and gas supply growth until 2024. That’s according to the International Energy Agency’s (IEA) annual oil market forecast, published in occasion of the CERAweek by IHS Markit, the annual gathering of energy industry leaders in Houston, Texas. According to IEA, the United States will become a net oil exporter in 2021, with exports of oil and derivatives exceeding imports by the end of 2024, reaching 9 million barrels per day, overtaking Russia and closing in on Saudi Arabia. IEA expects the global oil demand to rise to 106.4 million barrels per day in 2024, from 99.2 million in 2018. An average increase in demand of 1.2 million barrels per day, 44% of which will come from China and India. Figures that follow a record growth of 2.2 million b/d in 2018. Other non-OPEC oil producing countries, including Brazil, Norway and Guyana, are also expected to considerably increase their production.

The second wave of the shale revolution is coming

 "The second wave of the U.S. shale (oil and gas found trapped within shale formations) revolution is coming", said IEA’s executive director Fatih Birol. “It will see – he added – the United States account for 70% of the rise in global oil production and around 75% of the expansion in liquefied natural gas (LNG) trade over the next five years. The US have become the first exporting country in less than 10 years, thanks to the shale industry’s ability to "react quickly to price fluctuations by increasing production", says the report.

EPA chief says US energy is "cleaner" than Russia's

Andrew Wheeler, Administrator of EPA, the United States Environmental Protection Agency, tells Europe and the world to buy oil, gas and coal from the US, "because their energy is cleaner". Wheeler said that US environmental regulations on energy production are tougher than those of other countries. "What the U.S. offers the world in terms of energy is fossil fuels extracted in a more environmentally conscious manner than anywhere else in the world". If "Europe wants to buy natural gas on the market place we produce ours in a much cleaner way than Russia, for instance", he said, when pressed about the urgency of addressing climate change. EPA’s new chief, a longtime lobbyist for companies in the energy sector, including a coal company, chose the CERAWeek stage to take direct aim at the 'Green New Deal' launched by US democrats in Congress, which aims to accelerate the promotion of green energies. "There are a few loud voices calling for the dismantling of the U.S. fossil fuel production, but not only would this be dangerous for energy security and the national economy, it would be devastating for public health both here and abroad", said Wheeler, admitting that environment issues are politicized but only because Donald Trump’s administration "is doing many good things for the environment” he said.  Among the White House’s latest proposals, the construction of next generation electric power stations fueled by coal and opening protected areas to oil and gas explorations.

China calls for cooperation

In the oil and gas sector there is scope for collaboration between the US and China. Said Hou Qijun, vice general manager of CNPC (China National Petroleum Corporation), at a time when Washington and Beijing are attempting to reach an agreement on the trade war that has led to a drastic reduction of China’s imports of US produced NLG (Natural Liquefied Gas). According to CNPC’s manager, China’s gas demand will continue to grow at an 8% rate.