* Efficiencies allow unlocking of new shale resources
* Oil demand 'responding strongly' to low oil prices
* Global demand for energy to rise by 34 percent
By Ron Bousso
LONDON, Feb 10 (Reuters) - U.S. shale oil production willdouble over the next 20 years as drillers that became moreefficient amid a slump in oil prices unlock new resources,British energy giant BP said on Wednesday.
In its industry benchmark 2035 Energy Outlook, BP forecastglobal demand for energy to increase by 34 percent, driven bygrowth in the world population and economy, with the share ofoil declining in favour of gas and renewables.
U.S. shale or tight oil production using fracking technologywas a key driver behind global supply growth in recent years.The sector, with relatively expensive production costs, hasnevertheless been hard hit by a 70 percent decline in oil pricesover the past 18 months to around $30 a barrel.
But in the longer term, shale production is set to grow fromaround 4 million barrels per day (bpd) today to 8 million bpd inthe 2030s, accounting for almost 40 percent of U.S. production,according to the report.
"We see U.S. tight oil falling over the coming years butthereafter tight oil picks up," BP Chief Economist Spencer Dalesaid.
U.S. onshore production in the lower 48 states has declinedby around 500,000 bpd since last spring and is expected to fallfurther in the near term as the global market readjusts beforerebounding, Dale said.
According to the report, "technological innovation andproductivity gains have unlocked vast resources of tight oil andshale gas, causing us to revise the outlook for U.S. productionsuccessively higher".
Globally, tight oil production will rise by 5.7 million bpdto 10 million bpd but remain primarily concentrated in theUnited States.
The head of Russian state-run oil company Rosneft,in which BP holds a near 20 percent stake, said on Wednesday heexpected U.S. shale oil production to peak by 2020 and declinein the long term.
Dale also said global oil demand, which grew by 1.8 millionbpd last year, would continue to grow "strongly" this yearalbeit at a slower pace.
"The market is responding very clearly to lower oil prices,"Dale said.
HIGHER EFFICIENCIES
Fossil fuels, which include oil, gas and coal, will remainthe dominant source of energy, accounting for around 80 percentof energy supplies in 2035. Gas remains the fastest-growingfossil fuel, rising by 1.8 percent per year compared to oil's0.9 percent growth.
Coal is set to be the main casualty of the world's shifttowards cleaner forms of energy, as its share in the energy mixis set to drop to an all-time low by 2035.
Renewable sources of energy such as solar and wind areprojected to grow at around 6.6 percent per year, increasingtheir share in the energy mix from 3 percent today to 9 percent.
Yet at the current projection, the world is far from meetinggoals set by the United Nations to limit global warming to 2degrees Celsius (3.6 degrees Fahrenheit) above pre-industriallevels by the end of the decade.
While gross domestic product should more than double overthe period, energy demand will grow by only one third due tohigher energy efficiency and changes in economies such as China,which will become less energy-intensive, Dale said.
Much of the demand growth will be driven by an expansion ofthe global vehicle fleet, which will double by 2035 from around1.2 billion today to 2.4 billion.
"Unless the global economy grows far more slowly thananybody thinks, you will get material growth in energy demandover the next 20 years," Dale said.
(Reporting by Ron Bousso; Editing by Dale Hudson)