The United States will continue to produce copious amounts of oil and natural gas through at least 2016, the Energy Information Administration said Monday, with natural gas production likely to spike for the next two decades at a minimum.
The EIA released the bullish targets as part of an early release of its 2014 Annual Energy Outlook, which looks at various factors shaping U.S. energy markets through 2040.
The updated projections jibe with a similar survey released last month by the International Energy Agency, in which the energy watchdog said the United States will soon surpass Russia and Saudi Arabia as the top oil producer on the planet.
(Read more: US to surpass Saudi as top oil producer by 2016: IEA)
Underscoring the extent to which the domestic shale oil boom is boosting output, the EIA expects annual U.S. crude production to increase by about 800,000 barrels per day through 2016—a rate that will drive annual output to nearly 10 million barrels per day before declining in 2020. However, that pace is close to the 1970 record of 9.6 million barrels per day, and will help push total energy imports down to just 4 percent of domestic consumption by 2040.
The breakneck expansion of natgas—a more environmentally friendly energy source that has become a linchpin in electricity generation—will push ahead for at least the next 40 years, the EIA added.
The American Petroleum Institute, an oil and gas industry trade association, hailed the new forecasts and applauded the U.S. fracking boom.
“America is in the midst of a game-changing energy revolution,” API chief economist John Felm said in a statement. “Growth in the oil and natural gas industry is the key to securing our future, creating millions of new jobs, and providing billions in revenue to the government.”
Though domestic crude oil production is seen leveling off and then declining after 2020, natgas production will rise steadily through 2040, the EIA said.
By 2040, natural gas will account for 35 percent of total electricity generation, gradually displacing coal use, which is expected to fall to 32 percent. Additionally, the EIA expects renewable fuel use to be higher in coming years—a reversal of fortune from just a few short years ago, when the shale boom largely sidelined the push to expand green sources such as solar and wind.
—By CNBC’s Javier E. David.