The U.S. Energy Information Administration (EIA) said China is projected to pass the United States and become the world's largest net importer of oil on a monthly basis by October, and on an annual basis by 2014.
According to the EIA's Short-Term Energy Outlook for August, China's steadily growing demand for oil -- coupled with increased oil production, and flat demand for oil in the United States -- is the driving force behind China's emergence as the world's largest net importer of oil.
The EIA said total annual oil production in the United States is expected to increase by 28% between 2011 and 2014, to nearly 13 million b/d, with the oil coming primarily from shale plays, tight oil formations and the deepwater Gulf of Mexico (GOM). Meanwhile, Chinese production is only projected to increase 6% during the same time frame, to just one-third of U.S. production in 2014.
China's demand for liquid fuels, which includes crude oil, lease condensates, natural gas liquids (NGL) and biofuels, is projected to increase 13% between 2011 and 2014, to more than 11 million b/d. In the United States, demand for liquid fuels is projected to stay close to 18.7 million b/d, down from a peak of 20.8 million b/d in 2005.
"Looking beyond 2014, higher U.S. oil production and stagnant or declining U.S. oil consumption, coupled with China's projected strong oil demand growth and slow oil production growth, suggest that once China replaces the United States as the world's largest net oil importer, the gap between net oil imports in China and the United States will grow," the EIA said Friday.
The EIA said a country's dependence on foreign oil imports could be measured by the ratio of net imported crude oil to net crude oil inputs to refineries. By that measure, the EIA said the United States has emerged as "a significant net exporter" of petroleum products, because in recent years a portion of the country's crude oil imports has been used to produce products that are not consumed domestically.
By comparison, "the advent of China as the world's largest importer based on the narrower measure occurs on a different schedule than for the broader one, but the basic trends and drivers remain the same as for the broader measure. However, imports of crude oil alone do not automatically imply domestic dependence on foreign supplies."