With Americans still battling high prices at the pump, it may sound unthinkable, but the International Energy Agency (IEA) says the U.S. could overtake Saudi Arabia to become the world’s largest oil producer within five years.
The new forecast is an abrupt departure from the earlier IEA projections, which saw Saudi Arabia maintaining its hold as biggest oil producer through 2035, Reuters notes.
The IEA estimated that U.S. oil production would hit 10 million barrels per day in 2015. Production will peak at 11.1 million barrels per day in 2020, and decline to 9.2 barrels per day by 2035. By contrast, Saudi Arabia will produce 10.9 million barrels of oil in 2015, slip to 10.6 million barrels per day in 2020, but will see that output increase to 12.3 million barrels per day over the next 15 years.
According to the agency’s annual report, the U.S. oil industry is leveraging new technologies to access light tight oil and shale reserves. A number of companies are working to exploit U.S. shale oil reserves, including MarkWest Energy Partners (NYSE:MWE), Range Resources (NYSE:RRC), EQT (NYSE:EQT), Cabot Oil & Gas (NYSE:COG) and Rex Energy (NASDAQ:REXX).
If the trend continues, the U.S., which currently imports 20% of its oil, will become completely oil self-sufficient by 2035. But even before that, in 2030, the U.S. will become a net exporter of oil.
While the U.S. will see its oil output rise, OPEC nations will still provide most of the world’s oil, especially after 2020 as Iraq surpasses Russia as the second-largest oil producer.