Move over, Saudi Arabia. The United States is back.
In case you missed the news reports, sometime this year the United States will surpass Saudi Arabia and Russia as the world’s largest producer of liquid energy, the sum of crude oil and biofuels, according to projections just released by BP in its report, “Energy Outlook 2030.” By 2017, the United States will no longer the world’s largest oil importing nation. We already became the world’s largest producer of natural gas in 2011, and barring government restrictions will soon be a major exporter.
For the first time in generations, we will be self-satisfied.
“Growing production and flat consumption will see the U.S. become nearly self-sufficient in energy by 2030,” said the BP report. “The U.S. will remain a small net importer of oil, although net imports will decline by about 70 percent. With net exports of natural gas and coal, U.S. energy production will reach 99 percent of domestic consumption, up from a low of 70 percent in 2005.”
That’s it, a sip from the grail. Energy independence — what all those politicians and experts said they wanted, what every president since Nixon listed as a top priority, what seemed impossible short years ago. The dismal predictions of decline and dependency have been turned upside down. The economic and geopolitical consequences we are just beginning to understand, but could range from big to enormous.
This is the consequence, the BP analysts say, of political and economic conditions in the United States. There is the incentive of profit, the push of competition, the drive for innovation, and the relative absence of government-imposed obstacles that have allowed us to tap once inaccessible supplies of oil and gas. Techniques like horizontal drilling and hydraulic fracturing, or “fracking,” have unlocked vast stores of wealth.
“Fears over oil running out — to which BP has never subscribed — appear increasingly groundless,” BP chief executive Bob Dudley said in a press release. “The U.S. will not be increasingly dependent on energy imports, with energy set to reinvigorate its economy.” In the report’s introduction he said, “What messages do we draw from this Outlook? It underlines the power of competition and market forces in driving efficiency and innovation — importantly not only in unlocking new supplies such as unconventional oil and gas but also in improving energy efficiency and consequently limiting the growth of carbon emissions.”
Making a significant contribution to U.S. independence is the moderation of our thirst. Demand for fuel in the United States is flat, thanks to new efficiencies in our vehicle fleet. The need for energy to fuel economic growth will see demand rise in China and India. It is expected that the United States will cease to be the world’s largest consumer of oil. “China is on pace to match Europe as the world’s leading energy importer by 2030, and will replace the United States as the world’s largest oil importing nation by 2017,” said BP.
Fossil fuels will continue to dominate the world energy mix, and that is not really news. The market share for nuclear and renewable energy will remain flat, said BP. Carbon emissions will increase, thanks to increased energy demand in the developing nations. More than 90 percent of growth in energy demand to 2030 will come from countries outside Europe and the United States, BP says. Carbon emissions will fall in the U.S. and Europe, thanks to energy efficiency, regulatory control, renewables and a continued shift from coal to gas.
President Obama will play a major role in sorting this out. The ease of exploration, growth in supplies, exports, the world balance of energy trade all will be impacted by federal policy, much at Obama’s command. Watch closely, for the future is in play.
Tracy Warner’s column appears Thursdays and Fridays. He can be reached at email@example.com or 665-1163.