The U.S. government on Monday said global oil consumption is likely grow by more than a quarter over the next quarter century, though proposed rules requiring automakers to improve fuel efficiency in the United States were not factored into the forecast.
World oil demand is expected to climb to 112.2 million barrels per day in 2035, the U.S. Energy Information Administration said in its annual international energy outlook. That would be up 27 percent from 88.20 million bpd in 2011 and is an increase of 1.4 percent over last year's EIA forecast.
"Most of the growth in liquids use is in the transportation sector, where, in the absence of significant technological advances, liquids continue to provide much of the energy consumed," the EIA said.
The EIA's projections were based on current government policies and do not include any proposed or potential regulations, including the recently announced U.S. fuel economy standards that would force automakers' fleets to average 54.5 miles per gallon by 2025.
The United States is the world's largest consumer of crude oil.
Global petroleum consumption could rise 26.9 million bpd between 2008, the baseline year for the EIA's forecasts, and 2035. The increase in conventional oil production would meet less than half of this growth at 11.5 million bpd.
OPEC producers are expected to increase spare capacity to maintain their 40 percent share of the world's liquid fuel production over the next 24 years.
But conventional oil production from the cartel was projected to supply 10.3 million bpd of the growth in total oil output, down from the 11.5 million bpd previously estimated.
Non-OPEC countries were projected to add 7.1 million bpd from conventional oil supplies to world oil production, up from the 4.8 million bpd estimated last year.
EIA forecasts production of unconventional sources of liquid fuels, such as biofuels and oil sands, to rise to 13.1 million bpd in 2035 from 3.9 million bpd in 2008.
World oil markets will likely be very tight in the coming decades as the world grapples with rising demand from developing nations, said Howard Gruenspecht, the EIA's acting administrator.
"Very few producers have the incentive to intentionally build spare capacity, so we're going to be operating in world where the type of spare capacity we had seen ... we're unlikely to see again," Gruenspecht said at an event unveiling EIA's forecast. "There will be a lot of volatility."
WORLD ENERGY CONSUMPTION
It sees global overall energy use increasing 53 percent over the next 24 years, led by developing nations such as China and India.
Natural gas demand is projected to have the fastest growth rate among fossil fuels, reaching 169 trillion cubic feet in 2035 from 111 trillion cubic feet in 2008.
As shale gas production in the United States, as well as Canada and China, rises substantially, natural gas consumption will increase 1.6 percent per year from 2008.
While fossil fuels will likely remain dominant, renewable energy is projected to be the fastest growing energy segment.
Growing at a pace of 2.8 percent a year, renewable energy could make up 15 percent of total energy use by 2035, up from 10 percent in 2008.
© 2015 Thomson/Reuters. All rights reserved.