Exxon Mobil predicts that U.S. oil imports have peaked due to increased domestic oil supplies and a drop in oil demand.[i] The company expects U.S. oil imports to decline to 7 million barrels of oil per day by 2040, from its current level of 8.6 million barrels per day (10-month average for 2011). With the expectation that oil imports will continue to decline over the next 3 decades, the United States eventually becomes independent of OPEC oil, which currently accounts for more than 40 percent of U.S. oil imports.[ii]

U.S. oil demand is expected to decline due to gains in energy efficiency and little population growth over the next three decades. Domestic oil supplies increase due to continued development of unconventional oil resources (e.g. shale oil) and deepwater oil fields in the Gulf of Mexico. Exxon Mobil predicts that the United States will obtain most of its oil imports from Canada and Mexico by 2040, compared to 34 percent today (10-month average for 2011).

This direction for oil production and imports in the United States is not surprising. According to the Institute for Energy Research (IER), technically recoverable oil resources in North America total more than 1.7 trillion barrels, enough to last the United States for about 250 years at current consumption rates.[iii] The international Energy Agency is also looking to North America for future oil supply increases, predicting that the United States and Canada will increase oil supplies by 3 million barrels per day by 2016 due to higher exploration and production spending and new technologies to boost recovery rates.[iv]

Exxon Mobil Long-Term Forecast Highlights

Last week, Exxon Mobil released its Outlook for Energy: A View to 2040.[v] The following are some of the global trends that the company is forecasting:

  • Global GDP is expected to double by 2040 and population is expected to reach almost 9 billion people from 7 billion today.
  • Global energy demand is expected to increase by 30 percent in 2040 compared to 2010. Energy demand in the countries of the Organization for Economic Cooperation and Development (OECD) is expected to remain flat, while energy demand in non-OECD countries is expected to increase by almost 60 percent by 2040. China’s energy demand is expected to flatten around 2030, but continue to increase before then.
  • Oil, natural gas, and coal are expected to account for about 80 percent of global energy consumption by 2040. Global demand for natural gas is expected to increase by over 60 percent by 2040, overtaking coal as the second largest supplier of energy behind oil as government policies curb coal use. Natural gas is expected to produce 30 percent of the world’s electricity by 2040.
  • Coal use is expected to grow through 2025, primarily in developing nations such as China and India and the African continent. Post 2025, coal use is expected to drop for the first time in history due to the desire to curb greenhouse gas emissions and a decline in China’s population forecasted after 2030.
  • Efficiency improvements are expected to constrain energy demand growth particularly in the transportation sector where average new car fuel economy is expected to be almost 50 miles per gallon by 2040 from 27 miles per gallon today.  Growth in hybrid vehicles and other advanced vehicles, which are expected to constitute 50 percent of light duty vehicles in 2040 from less than 1 percent today, will be the major players in increasing vehicle fuel economy even though the passenger car fleet is expected to double to 1.6 billion vehicles by 2040.[vi] Without these improvements in efficiency, global demand would be about 4 times higher than predicted.[vii]
  • Global demand to fuel large trucks, airplanes, ships, and trains is expected to increase by 70 percent between 2010 and 2040 due to world economic growth and the need to move cargo.
  • By 2040, 90 percent of the world’s transportation is still predicted to run on oil-based fuels, which are expected to increase 25 percent by 2040. At current demand levels, Exxon Mobil estimated that the world has enough oil to last 100 years.
  • Global demand for liquid fuels is expected to increase from about 88 million barrels per day today to 110 million barrels per day by 2040. An increasing number of those barrels will come from non-traditional sources such as deepwater fields, Canadian oil sands, natural gas liquids and biofuels such as ethanol.
  • Shale gas is expected to be produced in almost every continent using drilling techniques such as hydraulic fracturing. Gas production is expected to double over the next three decades to more than 500 billion cubic feet per day.
  • Electricity is expected to supply over 40 percent of global energy consumption by 2040, growing by  80 percent between 2010 and 2040 due to improved living standards and economics and a switch from coal, oil, and biomass to electricity.
  • Global demand for nuclear power is expected to almost double by 2040 as countries work to lower greenhouse gas emissions and diversify energy sources.
  • Renewable fuels (solar, wind, hydroelectric, geothermal, and biomass) are expected to supply over 15 percent of the world’s electricity by 2040, led by hydro and then wind.
  • Carbon dioxide emissions are expected to peak in 2030 and then level off.  Carbon dioxide emissions in China, the world’s largest emitter, are expected to decline after 2025. China, which currently accounts for 50 percent of the world’s coal consumption, is expected to decrease its coal usage after 2025 by over 10 percent by 2040. Exxon Mobil’s prediction is based on increased costs of carbon dioxide emissions, at close to $60 per ton in most developed countries in 2040, about 6 times more than Europeans are currently paying.[viii]


Due to unconventional supplies of oil and natural gas, these fuels are expected to supply almost 60 percent of the world’s energy demand and 66 percent of North America’s energy demand in 2040, according to Exxon Mobil’s forecasts.  That level of supply is not very surprising since IER has estimated that North America has 1.7 trillion barrels of technically recoverable oil, enough to last the United States almost 250 years at current oil consumption rates, and 4,244 trillion cubic feet of technically recoverable natural gas, enough to last the United States over 175 years at current natural gas consumption rates.


[i] Market Watch, Exxon expects that U.S. oil imports have peaked, December 8, 2011, http://www.marketwatch.com/story/exxon-expects-that-us-oil-imports-have-peaked-2011-12-08?reflink=MW_news_stmp

[ii] Energy Information Administration, Monthly Energy Review, http://www.eia.gov/totalenergy/data/monthly/pdf/sec3_7.pdf

[iii] Institute for Energy Research, North American Energy Inventory, December 2011, http://energyforamerica.org/wp-content/uploads/2011/12/Energy-Inventory-FINAL.pdf

[iv]Bloomberg Business Week, U.S., Canada to Lead Non-OPEC Oil Output Gains to 2016, IEA Says, December 13, 2011, http://www.businessweek.com/news/2011-12-13/u-s-canada-to-lead-non-opec-oil-output-gains-to-2016-iea-says.html

[v] Exxon Mobil, 2012 The Outlook for Energy: A View to 2030, December 2011, http://www.exxonmobil.com/Corporate/Files/news_pub_eo2012.pdf

[vi] Wall Street Journal, Exxon Declares Gas King, December 8, 2011, http://online.wsj.com/article/SB10001424052970203501304577084594165136990.html

[vii] Business Week, Exxon Mobil predicts surge in hybrid vehicles, December 8, 2011, http://www.businessweek.com/ap/financialnews/D9RGK6C00.htm

[viii] Reuters, Exxon Mobil sees global CO2 emission s peak in 2030, December 8, 2011, http://www.reuters.com/article/2011/12/08/us-exxon-idUSTRE7B72EP20111208

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