International Energy Outlook 2010

With Projections to 2035

Center for Strategic and International Studies

May 25, 2010
Washington, DC

Howard Gruenspecht, Deputy Administrator

 Non-OECD countries account for 86% of the increase in
global energy use
energy consumption
quadrillion Btu

800 739
Non-OECD 687
OECD 639
590
600 543
495 62%

400
50%

200
50% 38%

0
2007 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 2
 Renewables are the fastest growing energy source
(but from a relatively small base)
world primary energy consumption
quadrillion Btu

History Projections
250
Liquids 30%
(including biofuels) 28%
200
35%
22%
150 Coal
Share of
27% Natural gas world
total
Renewables
100 14%
23% (excluding biofuels)

10%
50 6%

5%
Nuclear
0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 3
 Economic activity and population drive increases in energy
use; energy intensity improvements moderate this trend
average annual change (2007-2035)
percent per year

6 GDP
Population
5 Energy use per GDP
4

2
1

-1

-2

-3
United OECD Japan South China India Brazil Middle Africa Russia
States Europe Korea East

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 4
 The IEO reflects uncertainty in oil prices through a wide set
of price cases
light, sweet crude oil price
2008 dollars per barrel

225 History Projections

$210
200
High Oil Price case
175

150
Reference case $133
125
100
75

50 $51
Low Oil Price case
25

0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 5
OPEC producers maintain an approximate 40% share of total
liquids production in the Reference case
liquids production
million barrel per day

120 History Projections

111
100
Total
85
80

60 52
48 Non-OPEC conventional
45
40
OPEC conventional
34
20
3 Unconventional 13

0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 6
 Growth in OPEC production of conventional liquids comes
primarily from Saudi Arabia and Iraq
conventional liquids production
million barrels per day

16

14
2007 2020 2035
12

10

0
Saudi Arabia Iran Iraq Other Middle Africa South America
East OPEC

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 7
 Brazil, Russia, Kazakhstan, and U.S. lead increases in non-
OPEC conventional supplies
conventional liquids production
million barrels per day

16

14
2007 2020 2035
12

10

0
Russia United Brazil Kazakhstan OECD Mexico Canada
States Europe

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 8
 Canadian oil sands and biofuels account for 70% of the
increase in total unconventional liquids
unconventional liquids production
million barrels per day

5
2007 2020 2035
4

0
Oil sands/ Biofuels Extra-heavy Coal-to- Gas-to-liquids Shale oil
bitumen oil liquids

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 9
 The high oil price case assumes much lower production
from key oil exporters
liquids production in 2035
million barrels per day

Reference case High Oil Price case

45 42
OPEC Non-OPEC
40 39

35
30
25 22
20
15 15
15 13
11
10 9
6 7 6
6 5
4 4 3
5
0
Saudi Iraq Iran Other Russia Brazil China Other Non-
Arabia OPEC OPEC

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 10
 Non-OECD Asia accounts for 35% of increased
natural gas use
natural gas consumption
trillion cubic feet

160 156
150
145
136 Non-OECD Asia
140
125
120 Middle East
108
100 Other OECD

80 Central/South America

60
Africa
40
Non-OECD
20 Europe/Eurasia
US
0
2007 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 11
The Middle East accounts for almost one-third the increase
in global gas production

Percent
Change
2007-2035
Other OECD -9%

Australia/New Zealand 164%

United States 22%
Central and South America 101%
Non-OECD Europe/Eurasia 21%
Africa 104%
Non-OECD Asia 75%
Middle East 125%

-4 -2 0 2 4 6 8 10 12 14 16 18
natural gas production
trillion cubic feet
Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 12
 Tight gas, shale gas, and coalbed methane drive supply
growth in China, Canada, and the U.S
natural gas production
trillion cubic feet

25

20

Tight gas,
15 shale gas, and
coalbed methane

10

5
All other gas

0
2007 2035 2007 2035 2007 2035
China Canada United States

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 13
 Virtually all growth in global coal use occurs in non-OECD
Asian nations, especially China and India
world coal consumption
quadrillion Btu

160 History Projections

140

120
Non-OECD Asia
100

80

60

40 Rest of the world

20
North America
0
1990 1995 2000 2005 2010 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 14
 Renewables are fastest growing, but coal still fuels the
largest share of the world’s electricity in 2035
world electricity generation
trillion kilowatt hours

40
Liquids Nuclear Other renewables
Hydroelectricity Natural gas Coal

30
43%

20
19%
42%

15%
10 21%
16% 7%
2%
14% 13%
0 5% 2%
2007 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 15
 Non-OECD transportation fuel use surpasses almost flat
OECD fuel use by 2025
transportation sector energy consumption
quadrillion Btu

100 History Projections

Non-OECD
80

60
OECD

40

20

0
2005 2010 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 16
 Freight energy use increases faster than passenger
energy use
transportation energy consumption
quadrillion Btu

OECD Non-OECD
80

70

60

50
Freight
40

30

20
Passenger
10

0
2007 2020 2035 2007 2020 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 17
Assuming no policy changes, energy-related carbon dioxide
emissions grow 43% from 2007 to 2035
energy CO2 emissions
billion metric tons

45 42
Non-OECD 39
40
OECD 36
35 34
30 32 67%
30

25
53%
20

15

10
47% 43%
5

0
2007 2015 2020 2025 2030 2035

Howard Gruenspecht, CSIS, May 25, 2010 Source: EIA, International Energy Outlook 2010 18
 Key trends from 2007 to 2035

• In the IEO2010 Reference case, global marketed energy

consumption grows by 49 percent
– Most of this growth occurs in non-OECD Asia and the Middle East
• With no policy changes that would limit their use, fossil fuels provide
nearly 80 percent of world energy consumption in 2035
– Petroleum liquids remain the world’s single largest energy source even
as their share of total energy use declines
– Renewable energy gains a growing share of total energy use, as its
absolute growth in use from 2007 to 2035, outstrips that of petroleum
liquids despite starting from a much lower level
• Energy-related carbon dioxide emissions are projected to rise from
30 billion metric tons in 2007 to 42 billion metric tons in 2035 under
current laws and policies
• Meeting the projected increase in world liquids demand will require
increases in conventional and unconventional supplies of 25.8
million barrels per day
– Oil prices reach $133 per barrel in 2035 (real 2008 dollars per barrel)

Howard Gruenspecht, CSIS, May 25, 2010 19

 Key Trends from 2007 to 2035 (continued)

• Natural gas consumption increases 44%

– Developing Asia accounts for 35% of the increase in world consumption
– The Middle East accounts for 32% of the increase in production

• Coal use grows 56%

– China and India alone account for 85% of the increase

• Nuclear power generation increases 74%

• Total renewable energy use, including liquid biofuels, grows 111%

Howard Gruenspecht, CSIS, May 25, 2010 20

 For more information

U.S. Energy Information Administration home page www.eia.gov

Short-Term Energy Outlook www.eia.gov/emeu/steo/pub/contents.html

Annual Energy Outlook www.eia.gov/oiaf/aeo/index.html

International Energy Outlook www.eia.gov/oiaf/ieo/index.html

Monthly Energy Review www.eia.gov/emeu/mer/contents.html

National Energy Information Center (202) 586-8800

Live expert from 9:00 AM – 5:00 p.m. EST
Monday – Friday (excluding Federal holidays)
email: InfoCtr@eia.doe.gov

Howard Gruenspecht, CSIS, May 25, 2010 21