The U.S. is projected to become “energy independent” within the next decade, according to government analysts, meaning President-elect Donald Trump could deliver on a major campaign promise.
The U.S. is “projected to become a net energy exporter by 2026,” according to the Energy Information Administration’s (EIA) annual energy outlook, “but the transition occurs earlier” assuming high oil and natural gas prices, technological improvements and abundant reserves.
Trump could make America “energy independent” if conditions are right.
U.S. politicians have been preaching “energy independence” since the Arab oil embargo in the 1970s saw people waiting in line for hours at gas stations to fill up their tanks. But Trump could be the president when the U.S. exports more energy than it imports.
“Yes, the U.S. could be completely, I think the phrase used at one time was energy independent,” EIA Administrator Adam Sieminski told reporters in a press conference announcing the report.
Trump called for “complete American energy independence” on the campaign trail by repealing regulations that hamper energy production. Trump said he’d repeal as many of those rules as he could his first day in office.
“We will become and stay totally independent of any need to import energy from the OPEC cartel,” Trump told petroleum industry representatives in May. “We don’t deal with them. We’ll handle them just fine.”
“The United States has been a net energy importer since 1953, but declining energy imports and growing energy exports make the United States a net energy exporter by 2026,” EIA projects in its “reference case.”
“Crude oil and petroleum products dominate U.S. energy trade,” EIA reported. “The United States is both an importer and exporter of petroleum liquids, importing mostly crude oil and exporting mostly petroleum products such as gasoline and diesel.”
Increased domestic oil production from hydraulic fracturing, or fracking, has allowed oil companies to tap into previously unreachable shale formations. U.S. net oil imports have fallen nearly 60 percent since 2008 to 4.7 million barrels per day.
President Barack Obama signed legislation pushed by Republican lawmakers in 2015 that lifted the ban on crude oil exports, and several liquefied natural gas export facilities are expected to come online soon and send fuel abroad.
The U.S. will still be importing fuel from other countries, so it won’t be truly independent from the world. But becoming a net energy exporter is a huge milestone.
EIA projects U.S. “energy independence” could happen earlier, before 2020, if oil prices get high enough. EIA’s “high oil” scenario, however, assumes crude prices hit $226 per barrel by 2040. Crude prices are currently under $60 per barrel.
EIA’s “high oil and gas resource and technology” scenario sees energy independence in 2020 because “lower costs and higher resource availability than in the Reference case allow for higher production at lower prices.”
Trump would still be in his first term in both of those EIA scenarios.
Interestingly enough, EIA is not the first to predict the U.S. could become energy independent under Trump.
Trump adviser and oil billionaire Harold Hamm told CNBC the president-elect would reach energy independence in six years.
“It’s probably been delayed by a couple of years,” Hamm aid of low oil prices.