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Long-term EIA outlook predicts less reliance on foreign oil

Over the next 25 years a U.S. Energy Information Administration report predicts only modest growth in the nation’s demand for energy, which along with increased production of both domestic crude and natural gas will reduce reliance on foreign oil.

The Trucker News Services

6/28/2012

Less long-term dependency on foreign oil is not only possible but probable for the U.S. says a new government report.

Over the next 25 years a U.S. Energy Information Administration report predicts only modest growth in the nation’s demand for energy, which along with increased production of both domestic crude and natural gas will reduce reliance on foreign oil.

The EIA’s just-released long-term energy outlook also predicts that natural gas production will exceed demand, thus “allowing the United States to transition from a net importer to a net exporter of natural gas.”

The report says that admittedly it’s difficult to achieve accuracy in such long-ranging predictions, and that myriad factors, including energy policies, technology, the economy and other things could alter energy consumption and output. It makes projections for what it concludes as the most likely scenario and also shows 29 alternative outlooks “which explore the important areas of uncertainty for markets, technologies and policies in the U.S. energy economy.”

U.S. oil production increased from 5.0 million barrels per day in 2008 to 5.5 million barrels per day in 2010, and EIA in the report predicts that over the next 10 years continued development of tight oil in combination with the ongoing development of offshore resources in the Gulf of Mexico will push domestic crude production higher, although “key uncertainties” could alter that.

However, the executive summary says that “With modest economic growth, increased efficiency, growing domestic production and continued adoption of nonpetroleum liquids, net imports of petroleum and other liquids [would] make up a smaller share of total U.S. energy consumption.”

Specifically it predicts domestic crude production of more than 1 million barrels a day above 2010 levels by 2020.

Total U.S. consumption of petroleum and other liquids, including both fossil fuels and biofuels, is expected to rise from 19.2 million barrels per day in 2010 to 19.9 million bpd by 2035.

Noting that in end-use of energy, state and federal energy requirements and incentives play a continuing role, the report foresees energy demand for transportation to grow at an annual rate of 0.1 percent from 2010 through 2035, with energy consumption per capita declining by an average of 0.6 percent per year during the same period.

“New federal and state policies could lead to further reductions in energy consumption,” it added.

In a key highlight it was noted that “the rate of growth in energy slows in the projection period, reflecting moderate population growth, an extended economic recovery and increasing energy efficiency in end-use applications.”

Analysis included in the Annual Energy Outlook 2012 shows that extending and expanding certain energy-related policies beyond their current “sunset dates” could reduce projected national energy consumption in 2035 by nearly 6 percent.