The report includes several caveats: While the USA will become a major exporter of light crude and refined products, it will remain a major importer of heavier crude oil that is used in many of its refineries.
The largest contribution to demand growth - nearly 30 per cent - would come from India, whose share of global energy would rise to 11 per cent by 2040, it said.
Some ministers for the Organization of Petroleum Exporting Countries said an extension of an agreement that sidelines about 2 percent of the total global demand for oil in an effort to balance the market was necessary next year. The IEA also predicts that wind power will become the leading source of electricity generation in the European Union shortly after 2030.
Crude oil markets are expected to be oversupplied in the current quarter and going into 2018, the IEA said.
"Yet this is precisely what is happening as a result of the US shale revolution - both for oil and for natural gas", the IEA said.
While the USA exported 100 billion cubic metres of Canadian gas in 2005, that figure fell by over a fifth in 2016.
At the same time, the renewable energy sources will become more important.
That will keep prices down and help make the USA a net exporter of oil - in addition to gas - by the late 2020s.
The emergence of the U.S. "represents a major upheaval for global market dynamics", said Dr Fatih Birol, IEA executive director.
"Using a scenario whereby current levels of OPEC production are maintained, the oil market faces a hard challenge in 1Q18 with supply expected to exceed demand by 600,000 bpd followed by another, smaller, surplus of 200,000 bpd in 2Q18", the agency said.
"Canada is well placed to export oil to China, although this is dependent on the construction of additional export capacity to bring inland production to the Pacific coast", the IEA said.
The less-than-bullish forecast for Canadian oil and gas, means the IEA has cut the country's investment spend in the country to US$1.08 trillion in 2040 (from US$1.68 trillion in its forecast last year) - part of a global cut in investment projections.
Crude has climbed lately to a two-year high around $57 USA a barrel in trading in NY, although it is not seen making much larger gains due to rising U.S. output.
After hitting a 10-year low of less than $30 in January, down from a peak of more than $100 in mid-2014, oil prices have recently been hovering around the $55 mark.
A more widespread use of electric cars will not be enough to consign oil to the past, said IEA Executive Director Fatih Birol.
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