News / USA

US Soon to Overtake Russia as Top Oil Producer

Pump jacks are seen in the Midway Sunset oilfield, California, April 29, 2013.
Pump jacks are seen in the Midway Sunset oilfield, California, April 29, 2013.
Reuters
The United States will become the world's largest oil producer next year - overtaking Russia - thanks to its shale oil boom which has transformed the global energy landscape, the West's energy watchdog said on Friday.

The prediction comes only days after estimates by the U.S. government showed the United States, the world's largest oil consumer, has ceded its ranking as top global oil importer to China, thanks to the shale revolution cutting import needs.

“The United States' place in the driver's seat of growth is also a throwback to decades past,” the International Energy Agency said in its monthly report.

The U.S. resurgence as an oil producer is already reshuffling the cards in the game of world energy diplomacy, playing it a new hand in relations with long-term ally and top OPEC producer Saudi Arabia.

Major producers such as Russia are now forced to invest billions of dollars into new pipelines towards Asia as they can no longer rely on demand from the West, and have to deal with increasingly assertive Beijing.

“With output of more than 10 million barrels per day for the last two quarters, its highest in decades, the nation is set to become the largest non-OPEC liquids producer by the second quarter of 2014, overtaking Russia. And that's not even counting biofuels and refinery gains,” the IEA said.

The agency, the Paris-based energy arm of the Organization for Economic Co-operation and Development (OECD) estimated that U.S. liquids production will average 11 million bpd in 2014 versus 10.86 million in Russia.

The spike in U.S. production will allow total non-OPEC supply to grow by an average of 1.7 million barrels per day in 2014, peaking at 1.9 million in the second quarter, the highest annual growth since the 1970s, the IEA said.

That robust growth will compensate for disruptions to Organization of the Petroleum Exporting Countries' production and provides a cushion for oil prices, which otherwise could have spiked much higher than the current $110 a barrel.

OPEC crude supplies slipped to below 30 million bpd for the first time in almost two years, led by steep drops in Libyan and Iraqi exports due to unrest and terminal repairs, and despite Saudi Arabian output topping 10 million bpd for a third month running.

The IEA said that growth in non-OPEC production was so strong that it further reduced its estimates for demand for OPEC crude next year by an average of 100,000 bpd to 29 million bpd - effectively 1 million bpd below current pumping levels.

European surprise

The IEA left its global oil demand growth forecast for 2014 broadly unchanged at 1.1 million bpd, an increase of 1.2 percent, saying the macroeconomic backdrop was improving.

“European demand data have surprised on the upside recently amid reports that the euro zone's recession ended in the second quarter of 2013 and signs of improvement in business confidence,” it said.

But it added that it saw significant downside risks due to the budget standoff in the United States and currency depreciation in many emerging market economies.

The IEA also said few observers expected sanctions on Iran's oil and finance sector to be eased anytime soon, despite a friendlier rhetoric from Tehran.

“Rather, most expect that turning the clock back on sanctions will be a drawn-out process based on tangible diplomatic progress with regard to the issues at hand, which many still view as a remote prospect,” it added.

The IEA estimated Iran's crude oil production had declined by 100,000 in September to 2.58 million bpd. Oil imports from Iran rebounded by 180,000 to 1.17 million thanks to higher purchases from China and India.

It said preliminary data indicated China lifted imports from Iran to a four-month high of 555,000 bpd, India increased them to 265,000 bpd, highest since January 2013, and Pakistan imported first oil from Iran since January 2011.

You May Like

Report: $60 Billion Leaves Africa Illegally Each Year

Report by a joint UN and African Union panel says African countries need to take concrete measures to stop billions of dollars from illegally being moved out of continent each year More

Video Spy Murder Probe Likely to Further Strain British-Russian Relations

Some analysts say Russian Tu-95 bombers were flying near British airspace to warn Britain about an inquest into a murdered Russian spy More

Mugabe Defends Image Amid Controversy at Close of AU Summit

He rejects concerns about how the West might perceive his leadership, saying he's focused on African development More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Spy Murder Probe Likely to Further Strain British-Russian Relationsi
X
Henry Ridgwell
January 31, 2015 10:50 PM
Relations between Russia and the West are set to become even more strained amid an inquiry in London into the murder of a former Russian spy. Lawyers at the inquiry accuse Russian President Vladimir Putin of directing a "mafia state." Meanwhile, Royal Air Force fighters intercepted Russian bombers close to British airspace this week, prompting authorities to summon Moscow’s ambassador. Henry Ridgwell reports.
Video

Video Spy Murder Probe Likely to Further Strain British-Russian Relations

Relations between Russia and the West are set to become even more strained amid an inquiry in London into the murder of a former Russian spy. Lawyers at the inquiry accuse Russian President Vladimir Putin of directing a "mafia state." Meanwhile, Royal Air Force fighters intercepted Russian bombers close to British airspace this week, prompting authorities to summon Moscow’s ambassador. Henry Ridgwell reports.
Video

Video Ukrainian Neighborhood Divided Over Conflict

People in eastern Ukraine’s Donetsk and Luhansk districts find themselves squarely in the path of advancing Russian-backed rebels, who want to take back the territory they held at the beginning of the conflict last year. Many local residents are afraid, but others would welcome the change, even when a rebel shell lands in their neighborhood. From the Luhansk district, 15 kilometers from where the Ukrainian government marks the front line, VOA’s Al Pessin reports.
Video

Video Threat of Creeping Lava Has Hawaiians on Edge

Residents of the small town of Pahoa on the Big Island of Hawaii face an advancing threat from the Kilauea volcano. Local residents are keeping a watchful eye on creeping lava. Mike O’Sullivan reports.
Video

Video Jefferson's Library Continues to Impress, 200 Years Later

Two hundred years after the U.S. Congress purchased a huge collection of books belonging to former President Thomas Jefferson, it remains one of America’s greatest literal treasures and has become the centerpiece of Washington’s Library of Congress. VOA’s Deborah Block reports.
Video

Video Egypt's Suez Canal Dreams Tempered by Continued Unrest

Egypt plans to expand the Suez Canal, raising hopes that the end of its economic crisis may be in sight. But some analysts say they expect the project may cost too much and take too long to make life better for everyday Egyptians. VOA's Heather Murdock reports.
Video

Video Pro-Kremlin Youth Group Creatively Promotes 'Patriotic' Propaganda

As Russia's President Vladimir Putin faces international pressure over Ukraine and a failing economy, unofficial domestic groups are rallying to his support. One such youth organization, CET, or Network, uses creative multimedia to appeal to Russia's urban youth with patriotic propaganda. VOA's Daniel Schearf reports.
Video

Video Filmmakers Produce Hand-Painted Documentary on Van Gogh

The troubled life of the famous 19th century Dutch painter Vincent van Gogh has been told through many books and films, but never in the way a group of filmmakers now intends to do. "Loving Vincent " will be the first ever feature-length film made of animated hand-painted images, done in the style of the late artist. VOA’s George Putic reports.
Video

Video Issues or Ethnicity? Question Divides Nigeria

As Nigeria goes to the polls next month, many expect the two top presidential contenders to gain much of their support from constituencies organized along ethnic or religious lines. But are faith and regional blocs really what political power in Nigeria is about? Chris Stein reports.
Video

Video Rock-Consuming Organisms Alter Views of Life Processes

Scientists thought they knew much about how life works, until a discovery more than two decades ago challenged conventional beliefs. Scientists found that there are organisms that breathe rocks. And it is only recently that the scientific community is accepting that there are organisms that could get energy out of rocks. Correspondent Elizabeth Lee reports.
Video

Video Paris Attacks Highlight Global Weapons Black Market

As law enforcement officials piece together how the Paris and Belgian terror cells carried out their recent attacks, questions are being asked about how they obtained military grade assault weapons - which are illegal in the European Union. As VOA's Jeff Swicord reports, experts say there is a very active worldwide black market for these weapons, and criminals and terrorists are buying.
Video

Video Activists Accuse China of Targeting Religious Freedom

The U.S.-based Chinese religious rights group ChinaAid says 2014 was the worst year for religious freedom in China since the end of the Cultural Revolution. As Ye Fan reports, activists say Beijing has been tightening religious controls ever since Chinese leader Xi Jinping came to office. Hu Wei narrates.
Video

Video Theologians Cast Doubt on Morality of Drone Strikes

In 2006, stirred by photos of U.S. soldiers mistreating Iraqi prisoners, a group of American faith leaders and academics launched the National Religious Campaign Against Torture. It played an important role in getting Congress to investigate, and the president to ban, torture. VOA's Jerome Socolovsky reports.

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

All About America

AppleAndroid