US moves closer to ending net energy import era

The US is poised to cease being a net importer of energy for the first time since the 1950s as abundant domestic fossil fuel and efficiency measures reset its relations with world suppliers, a government forecaster has said.

The Energy Information Administration's annual energy outlook found that net energy imports would fall to zero by 2028 under its base case - or in just four years if oil prices or resources sharply exceeded expectations.

The annual outlook was the agency's first since oil markets began to collapse last year, dragging prices to six-year lows. In its base case, Brent crude would remain below $80 per barrel until 2020, well below its projection a year ago. The international oil marker was $58.72 per barrel on Tuesday, up 1.4 per cent.

Companies have begun to export some of the US energy bounty despite restrictions, such as a four-decade-old ban on crude oil exports. Cheniere Energy plans to begin liquefying US natural gas for export at a Louisiana terminal this year.

Oil refiners such as Valero are exporting record amounts of refined oil products such as diesel, while BHP Billiton and other producers have begun to export ultralight condensate oil after the White House loosened the crude export ban.

The US energy trade deficit has shrunk by 54 per cent from a peak of $416bn in 2008.

Adam Sieminski, EIA administrator, said: "With continued growth in oil and natural gas production, growth in the use of renewables, and the application of demand-side efficiencies, the projections show the potential to eliminate net US energy imports in the 2020 to 2030 timeframe."

Because of refineries' appetite for crude oil, the US continues to be a large net importer of oil with volumes of nearly 5m barrels per day. Under two scenarios with higher oil prices or higher resources, EIA said the US would become a net petroleum exporter in 2021.

US drillers have idled rigs in response to falling oil prices, leading to expectations that US crude production will level off this year. But in the longer term the EIA eyed "continued strong growth in domestic production in crude oil" from shale formations until 2020.

The outlook for resilient production was echoed on Tuesday by the International Monetary Fund, which examined the effects of lower prices in its World Economic Outlook. It found that a 1 per cent reduction in oil investment was associated with a 0.4 per cent decline in production from prevailing trends, but only after five years.

"Growth in oil production is not expected to slow significantly in the short term as a result of the recent oil price slump," the IMF said.

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