Global energy demand projected to grow through 2050

The United States likely will become a net energy exporter by 2022 as domestic production and global demand continue to grow while U.S. demand holds steady, the U.S. Energy Information Administration said this week.

Presenting the agency’s 2018 annual energy outlook, Administrator Linda Capuano said global demand for natural gas, oil, wind and solar energy likely will grow in the coming decades while demand for nuclear and coal will decline.

“We project the energy mix will continue to evolve as the U.S. pulls in new generation, which will primarily be natural gas and renewables after 2022,” Capuano said.

The country’s net exports will be led by natural gas, both in growing pipeline exports to Mexico and in increased liquefied natural gas exports to global markets, Capuano said.

“The United States has been a net energy importer since 1953, but declining energy imports and growing energy exports make the United States a net energy exporter by the early 2020s in the reference case,” Capuano said.

Net imports of oil and refined products are projected to drop through 2035, with the country becoming a slight net exporter beginning around 2030 in the reference case, she said.

The study mapped out seven scenarios, with the reference case selected based on the most likely set of many variables. The reference case, among other variables, is based on a projected international benchmark Brent oil price of $114 a barrel and a natural gas price of $5 per thousand cubic feet in 2050.

The other scenarios show Brent prices between $52 and $229 a barrel and natural gas between $3 and $9.

“Domestic and regional events have a greater impact on natural gas prices compared to the more internationally driven oil prices,” Capuano said.

For the nearer term, EIA boosted its domestic crude oil production forecasts for both 2018 and 2019 by 3.1 percent. The government now expects companies in the country to produce an average of 10.59 million barrels a day in 2018 and 11.18 million barrels a day in 2019.

U.S. production last week hit a record 10.25 million barrels per day, up 332,000 barrels per day from the previous week. Last week’s level topped the previous record of 10.04 million barrels per day set in November 1970.

Oklahoma producers and others throughout the country this month will detail their 2017 earnings and 2018 spending plans. While shareholders generally encourage companies to increase production, the focus this year likely will be much more on well profitability, which measures both production and total well costs.