Energy Industry Belief in U.S. Independence Grows, KPMG Says

Jun 24, 2014 10:16 am ET

(Updates with futures prices in sixth paragraph and background on KPMG in last paragraph.)

June 24 (Bloomberg) -- More oil and natural gas company executives believe the U.S. will be able to satisfy its energy needs without having to rely on other countries by 2030, a KPMG International survey released today shows.

Seventy-three percent of energy executives surveyed by KPMG say the U.S. can become energy independent within the next 16 years or sooner. That’s up 10 percentage points from its 2013 survey, according to the audit, tax and advisory services firm.

The U.S., the world’s third-largest oil producer, behind Saudi Arabia and Russia and the biggest natural gas producer, is shedding its reliance on foreign energy sources thanks to technology that’s allowed it to tap hard-to-reach oil and gas in shale formations in North Dakota, Texas, Pennsylvania, Colorado, Wyoming and Oklahoma. U.S. crude output topped 8.47 million barrels a day in the second week of June, the most since October 1986, and will average 9.27 million in 2015, according to the Energy Information Administration.

“Exciting new breakthroughs are leading to a whole new generation of domestic oil and gas production, particularly from deepwater, oil sands and shale assets,” John Kunasek, national sector leader for energy and natural resources for KPMG LLP, said in the statement.

Stable Prices

The survey of more than 100 senior executives in the U.S. representing global energy companies also found that the officials say oil and gas prices will stay relatively stable this year. Forty-seven percent of respondents say the average price of natural gas for 2014 will be in the range of $3.76 per million British thermal units to $4.50, while 44 percent of respondents expect Brent crude this year will average from $106 a barrel to $111, KPMG said in the statement.

As of yesterday, natural gas on the New York Mercantile Exchange had averaged $4.656 per million Btu since the beginning of the year and Brent crude, a benchmark for global prices, had averaged $108.63 a barrel on the London-based ICE Futures Europe exchange over that period. In trading today, natural gas for July delivery rose 5.8 cents, or 1.3 percent, to $4.504 per million British thermal units, while Brent for August settlement rose 36 cents to $114.48 a barrel.

The survey also found that energy firm executives in the U.S. expect mergers and acquisitions in their industry to be brisk over the next three years and the U.S. economy to continue to strengthen over the next year.

The web-based survey was completed in April by KPMG LLP, the U.S. member firm of Zurich, Switzerland-based KPMG International, company spokeswoman Megan Dubrowski said in an e- mail.