The report says that global energy demand is expected to grow 30 percent by 2040 and that demand for oil is not expected to peak until 2040. But the oil market isn't tightening as quickly as once anticipated, the IEA said in its monthly oil-market report.
The report from the Paris-based agency will come as grim news for officials attending global climate talks in Bonn, Germany, as they grapple with ways to contain carbon emissions.
According to the IEA, China overtakes the U.S. as the largest oil consumer around 2030, and its net imports reach 13 million barrels per day in 2040.
"A remarkable ability to unlock new resources cost-effectively pushes combined United States oil and gas output to a level 50% higher than any other country has ever managed; already a net exporter of gas, the U.S. becomes a net exporter of oil in the late 2020s", the IEA said in its 2017 world energy report. U.S. West Texas Intermediate (WTI) crude was at $56.72 per barrel, down 4 cents.The dips came after both crude benchmarks early last week hit highs last seen in 2015, but traders said the market had lost some momentum since then."Oil is fairly calm".
In Abu Dhabi on Monday, the UAE Minister of Energy and Industry Suhail bin Mohammed Faraj Faris Al Mazrouei, said that oil producers were expected to unanimously extend a production cut accord later this month, but its duration was still under discussion. It expects global demand for oil to even rise in the decades ahead.
"Next year's demand growth will struggle to match this", the IEA said. But analysts expect the price to not rise much further in coming months as the USA ramps up production.
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He leaves for the Philippines on Sunday afternoon where he will attend the ASEAN summit of Southeast Asian leaders. The exercises will also involve 11 US Aegis ships and seven South Korean naval vessels, including two Aegis ships.
While the IEA's base-case scenario projects oil prices reaching US$83 per barrel by 2025 and as high as US$111 by 2040, a low oil-price scenario could see prices stuck in the US$50 to US$70s if electric passenger cars take off, USA tight oil production continues to rise and upstream costs decline.
The IEA noted that output by the Organization of the Petroleum Exporting Countries was down by 830,000 bpd year-on-year in October, although demand for the group's crude is expected to fall to 32.6 million bpd in the fourth quarter of this year and to 32.0 million bpd in the first quarter of 2018.
"Prices ... are starting to look like a pause or pullback is needed", said Greg McKenna, chief market strategist at futures brokerage AxiTrader.
Despite the cautious sentiment, traders said oil prices were unlikely to fall far, largely due to supply restrictions led by the Organization of the Petroleum Exporting Countries and Russian Federation, which have helped reduce excess stockpiles.
"It's quite spectacular, because you're going to see the number of cars on the road double from one billion to 2 billion, thanks to electric vehicles and fuel economy standards", said Laura Cozzi, head of the Energy Demand Outlook division.