LONDON—Oil will continue growing as a source of energy for over two decades, with the U.S. set to become the undisputed leader in crude and gas production, the International Energy Agency said Nov. 14.
The report from the Paris-based agency will come as grim news for officials attending global climate talks in Bonn, Germany, as they grapple with ways to contain carbon emissions. Scientists just this week said that emissions of the heat-trapping gas rose this year after three years of not growing.
The IEA said oil production will be driven by continued growth in energy-hungry industries. Though solar power is set to become the cheapest source of new electricity generation and the boom years for coal are over, oil and gas will continue to meet the bulk of the world’s energy needs, the IEA said.
Oil demand is forecast to keep rising until 2040, with natural gas growing by a sharp 40 per cent.
A more widespread use of electric cars will not be enough to consign oil to the past, said IEA Executive Director Fatih Birol.
“It is far too early to write the obituary of oil, as growth for trucks, aviation, petrochemicals, shipping and aviation keep pushing demand higher,” said Birol.
Total energy demand is expected to have grown by 30 per cent by 2040—and would be growing twice that without efforts to improve energy efficiencies.
The price of oil has risen over 30 per cent since June to a two-year high of around $57 a barrel in New York trading amid evidence of stronger economic growth around the world. But analysts expect the price to not rise much further in coming months as the U.S. ramps up production.
The IEA echoed that view, saying it expects the U.S. to see a resurgence in its oil and gas industries and become the world’s biggest net exporter by the end of the 2020s. Asian countries will become the biggest net importers of oil and gas, taking in 70 per cent of imports by 2040 as their economies expand at a fast clip.
Environmental activists decried the IEA forecasts as discounting any efforts by countries to limit emissions as part of the Paris Agreement on climate change.
“None of its core scenarios for the future of energy provide a reasonable chance that the world will avoid climate catastrophe,” said Adam Scott, senior advisor at Oil Change International.