IEA: U.S. To Dominate Global Energy Markets through 2030
The United States will overtake Russia as the world’s leading producer of oil and natural gas, reshaping global markets, and bolstering national security, according to the International Energy Agency’s 2019 World Energy Outlook.
Going all the way up
According to the report, the United States will account for a staggering 85 percent of the world’s oil production growth and 30 percent of natural gas growth through 2030. Despite a slight plateauing from the astonishing progress seen over the last few years, shale output “is set to stay higher for longer than previously projected.”
This growth will continue to reinforce the country’s position as a major exporter of oil and natural gas. Between 2016 and 2018 alone, U.S. LNG exports more than quintupled, to a record nearly 1.1 trillion cubic feet of LNG in 2018. That’s about 189 billion cubic feet more than 2016 and 2017 combined.
IEA’s Fatih Birol attributed this increasing dominance in the world energy market to American investments in innovative technology:
“The shale revolution highlights that rapid change in the energy system is possible when an initial push to develop new technologies is complemented by strong market incentives and large-scale investment.”
Bolstering U.S. National Security
The United States’ increased influence in global energy markets bolsters national security and provides the opportunity to export much-needed energy across the globe. Not only is the country better insulated from supply chain disruptions due to foreign conflict, but America’s newfound energy abundance maximizes energy choice for its partners across the globe.
As U.S. Energy Secretary Rick Perry explained at this year’s CERA conference,
“Next year America will become a net exporter of energy, and we want the world to know that we stand with them to deliver affordable, abundant energy across the globe. World energy security is national security.”
“American energy doesn’t have strings attached. It’s clear that Russian gas has strings attached… American LNG has the ability to truly make Europe free from that Russian intervention.”
Kenneth Medlock, Senior Director of the Center for Energy Studies at Rice University, further explained the utility of the shale revolution in achieving U.S. geopolitical and foreign policy aims:
“As the U.S. increases its exports of crude oil, petroleum products and natural gas, its influence explants into those nations that increasingly rely on imports to satisfy their energy appetites associated with economic growth.”
Impact on Foreign Countries
America’s energy dominance is having a direct impact on other global energy leaders. IEA expects increasing U.S. output to diminish OPEC and Russia’s share of total global oil production to 47 percent in 2030, down from 55 percent in the mid-2000s.
As IEA’s Fatih Birol explained, the nation’s growing energy dominance provides increasing challenges for these countries:
“U.S. growth will limit the ability of traditional exporters to manage exports. Countries whose economies are exclusively reliant on oil-and-gas reserves are facing serious challenges.”
As the Wall Street Journal points out, this year’s World Energy Outlook comes just a couple weeks before OPEC leaders and their allies meet in Vienna to discuss continuing oil production cuts.
American energy also has the potential to match growing consumption across the globe. In particular, IEA sees a major expansion in Africa’s natural gas use, providing an opportunity for the United States to reduce energy poverty, while helping countries transition away from high polluting fuels.
As countries look toward the future, one thing is clear: According to IEA’s stated policy scenario, oil and natural gas is here to stay – with the United States leading the way in providing the world with cleaner, abundant energy to power the globe for decades to come.