Despite his campaign rhetoric to end fossil fuels, President Biden acknowledged in his recent State of the Union address that “we’re going to need oil for at least another decade.” But a new report released Thursday by Biden’s own independent agency on government projects may be much longer than that. In fact, the 2023 Annual Energy Outlook from the Energy Information Administration (EIA) finds that US oil production may increase between now and 2050 even as clean energy sources such as wind and solar power increase dramatically. Analysts say U.S. demand for oil and gas is likely to remain fairly stable for decades, and “we expect U.S. production to remain at historically high levels as exports of finished products increase,” said Angelina LaRose, EIA’s director of energy analysis. Assistant Administrator, meanwhile session on Thursday around the release of the report. The EIA is an independent government agency that produced this week’s report without input from the White House or other officials such as Energy Secretary Jennifer Granholm. His predictions have been echoed by outside experts in recent months, but Thursday’s presentation marked an official government acknowledgment of widespread expectations that U.S. oil and gas production is unlikely to decline anytime soon.
‘Motor gasoline and diesel fuels still in demand for 2050’
The US currently produces about 20 million barrels of oil per day. Looking ahead to 2050, EIA analysts see the possibility of a “high oil and gas supply” scenario where that number reaches about 30 million barrels per day in 2050. Production remains constant or goes down slightly in other models, but in each case the analysts modeled that the US would remain a net exporter of petroleum products and natural gas through 2050. The newly released report is likely to be cited frequently by Republican critics of President Biden, many of whom mocked him when he predicted his State of the Union. GOP and industry critics say Biden and his aides’ continued downplaying of the future for oil and natural gas companies is making companies afraid to invest in the future. The report also comes on the heels of the Biden administration’s decision to approve ConocoPhillips’ Willow drilling project in Alaska that would produce new oil for years. EIA analysts also see explosive growth in clean energy and clean electricity in the coming decades. The report offers three other key predictions for the energy industry that should also cheer environmentalists. It predicts rapid declines in CO2 levels “in all regions of the United States” due to a decline in coal production and a large increase in renewable energy production. He also expects technological changes such as more heat pumps in homes and more electric vehicles on the road to drive the overall energy industry towards cleaner energy. But the process is likely to be very slow. In the EV space, for example, EIA analysts project that clean cars will make up just under 20% of the overall automobile market in 2050. “Motor gasoline and diesel fuels are still in demand for 2050,” noted LaRose. Another report released Thursday by the agency studied the potential effects of the 2022 inflation reduction law on the energy sector, predicting significant changes from the landmark climate law. On overall CO2 output, levels are projected to fall 25% to 38% below 2005 levels by 2030 due to changes in legislation coming online. Ben Worshkull is the Washington correspondent for Yahoo Finance. Click here for the latest financial and business news from Yahoo Finance.
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