North America has the potential to be energy next Middle East

Deepwater drilling in the Gulf of Mexico, tapping shale deposits for gas and oil and Canada's oil sands are among the ingredients that could see North America's production of oil and natural gas liquids almost double to 26.6m barrels a day by 2020, according to a report by analysts at Citigroup. "The energy sector in the next few decades could drive an extraordinary and timely revitalisation and reindustralisation of the US economy," the 80-page report said. The vexed question of America's future energy needs and how to meet them has dominated the battle for The White House in recent weeks, as the Republican challengers blame President Barack Obama for the recent rise in petrol prices. Experts say the subject is also gaining political traction among both Republicans and Democrats because the US is at an important crossroads on its future energy policy. 2011 was the first year since 1949 that the country exported more petroleum products than it imported. Some of that was down to new supply, but declining domestic demand also played a role. US oil demand fell to 18.8m barrels a day last year, down almost 10pc from 2005, according to the Energy Department. The report predicts that the declining US demand for petroleum products, driven largely by the downturn, will continue as fuel efficient technologies are more widely adopted. That, too, could contribute to making North America the pivotal player in shaping global supply. "The growing Continental surplus of hydrocarbons points to North America effectively becoming the new Middle East by the next decade," the report argues. Its authors stress that the scenario it paints is one that could happen, rather than one that will. But they add that a reshaping of the America's position in the energy chain would have wider economic benefits, with up to 3.6m new jobs created. The question of America's energy policy is not an exclusively economic one, with concerns over the environment and the wider role of government featuring heavily in the debate in the US. "With political gridlock in Washington precariously high, it remains unlikely that a comprehensive energy policy will be achieved in the near future," the report says.