For the first time since Saudi Arabia began selling oil in the 1950, the United States is set to overtake the kingdom as the world’s largest energy exporter, according to a new report.
“Increasingly profitable shale production and a robust global appetite for light oil and gasoline is poised to bring the US to a position of oil dominance in the next few years,” Per Magnus Nysveen, a senior partner at independent energy research firm Rystad Energy, was quoted as saying in a press statement.
Rystad Energy estimated that Saudi Arabia exports around seven million barrels of oil per day, along with two million barrels of natural gas liquids and additional petroleum products.
The US currently exports around three million barrels on a daily basis, with another five million barrels per day of natural gas liquids and other petroleum products. Rystad Energy forecasts that the US will continue to grow at a fast pace and will overtake Saudi Arabia later this year.
“This means the US is destined soon to outpace Saudi Arabia when it comes to gross exports of oil and petroleum products,” Nysveen said.
“The political and economic impact of this shift in global trade has already been dramatic, and will be even more pivotal within the next five years. The US trade deficit will evaporate and its foreign debt will be paid quickly thanks to the swift rise of American oil and gas net exports. The tanker shipping industry will see the boom of the millennium, as the excess fossil fuels from America will find plenty of eager buyers in fast-growing Asia,” he added.
“It’s nothing short of remarkable,” Ryan Fitzmaurice, an energy strategist at Rabobank, told CNN about the report. “Ten years ago, no one thought it could happen.”
The news comes as it was reported on Friday that Saudi Arabia was already producing less oil than it is allowed under the quota agreed under the deal with the Organisation of the Petroleum Exporting Countries (OPEC).
A Saudi official told S&P Global Platts on Friday that the kingdom produced 10.1 million barrels per day in February, below the 10.31 million barrels per day agreed with OPEC. Around 70 percent of this is usually exported.
This figure is likely to decrease as Saudi energy minister Khalid Al Falih said last month that production in March would fall to 9.8 million barrels per day, with around 6.9 million barrels exported, even lower than the figure stated in the Rystad Energy report.
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