China will overtake the US to become the largest single consumer of oil globally, according to oil major BP’s Energy Outlook 2035.
The company said ongoing economic expansion in Asia – particularly in China and India – will drive the continued growth for demand in the next two decades.
The current weakness in the oil market, which it said stemmed in large part from strong growth in tight oil production in the US, will take several years to work through.
However shale gas production, BP said, is likely to slow and Middle East production will gain ground once more.
The US “is likely to have become self-sufficient” in oil by the 2030s.
Spencer Dale, BP’s group chief economist, said: “After three years of high and deceptively steady oil prices, the fall of recent months is a stark reminder that the norm in energy markets is one of continuous change.
“It is important that we look through short term volatility to identify those longer term trends in supply and demand that are likely to shape the energy sector over the next 20 years and so help inform the strategic choices facing the industry and policy makers alike.”
BP said demand for natural gas will grow fastest of the fossil fuels over the period to 2035, increasing by 1.9% a year, led by demand from Asia.
Half of this increased demand will be met by rising conventional gas production in Russia and the Middle East and about half from shale gas.
North America will produce about three quarters of the global shale gas supply by 2035.
The report said energy self-sufficiency in North America and increasing LNG trade are expected to have “fundamental impacts on global energy flows”.
It added: “Increased oil and gas supplies in the US and lower demand in the US and Europe due to improving energy efficiency and lower growth will combine with continuing strong economic growth in Asia to shift the energy flows increasingly from west to east.”
Carbon emissions are expected to grow and are currently on a trajectory which is “significantly above” the path recommended by scientists.
BP group chief economist Bob Dudley said: “The energy industry works on strategies and investments with lifespans often measured in decades.
“This is why an authoritative view of the key trends and movements that will shape our markets over this long term is essential… and is precisely why this Outlook is so valuable.”
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