Oil demand will keep expanding over the next five years, and the United States will fulfill most of the world's growing appetite, the International Energy Agency said on Monday.
In its latest annual outlook, the IEA forecasted that strong economic growth around the world will continue to support strong oil consumption until at least 2023. Along with surging output from the U.S., rising production in Canada, Brazil and Norway will be able to meet higher demand through 2020, the energy policy adviser said.
Beyond that, however, the IEA warned that oil supply could become tight unless investment in new production rebounds from historic declines in recent years.
"Upstream investment shows little sign of recovering from its plunge in 2015-2016, which raises concerns about whether adequate supply will be available to offset natural field declines and meet robust demand growth after 2020," IEA Executive Director Fatih Birol wrote.
The industry's investments fell by 25 percent in both 2015 and 2016 and were flat last year, according to IEA. Those declines dovetailed with an historic collapse in oil prices that saw benchmark crude futures fall from more than $100 a barrel in 2014 to below $30 in 2016.
The market has rebounded since the 14-member OPEC cartel partnered with Russia and other producer nations to cut output last year.