North America will become a net exporter of oil and other petroleum liquids by 2020, Exxon Mobil forecast Tuesday.
North America will become a net exporter of oil and other petroleum liquids by 2020, Exxon Mobil forecast Tuesday.
The company predicts that increased fracking and oil sands development would push North American production toward the equivalent of 30 million barrels of oil a day as continental energy demand stagnates. Under Exxon’s methodology, North American production was less than 20 million barrels a day in 2010.
Were the prediction to prove true, the United States, Canada and Mexico would join the ranks of Saudi Arabia and Russia as countries that produce more oil than they consume. It’s part of what Exxon described in its report as a larger global shake-up. Developing countries in Africa and Asia will consume more and more energy. At the same time the United States is becoming more efficient and growing its oil and natural gas production by leaps and bounds.
Currently, it would be virtually impossible for North America to become a net exporter because of a U.S. crude export ban instituted in the 1970s. But U.S. oil companies, eager to sell their crude on the international market, have been lobbying heavily to end it.
“At some point, you assume the ban is lifted. Now is the time to move; politically, it’s a lot easier to remove the ban when prices are falling than when they’re rising,” said Bud Weinstein, an economist with SMU’s Maguire Energy Institute.
By 2040, Exxon predicts global energy demand will grow by 35 percent as the world’s population grows and living standards in developing countries increase.
That will mean more business for oil companies. But Exxon also predicts that the fastest-growing energy sources will be wind and solar power and biofuels. By 2040, renewables will make up 15 percent of the world’s energy supply, Exxon said.
“Carbon-based fuels will continue to meet about three-quarters of global energy needs through 2040,” the report read. “The outlook shows a shift toward lower-carbon fuels in the coming decades that, in combination with efficiency gains, will lead to a gradual decline in energy-related carbon dioxide emissions.”