The Saudi investment firm said the kingdom could face a serious revenue crisis within the current decade as it cut exports to meet rising demand.
Saudi Arabia is still dependent on oil revenues to fund its entire state apparatus, welfare system and defense machinery. Efforts to achieve economic diversification have yet to produce substantial results.
Jadwa pointed out the kingdom's oil exports had declined from around 7.5 million barrels per day in 2005 to 5.8 million bpd in 2010 and could drop further by 2015.
An expected high growth in domestic consumption could prompt the government to reduce exports to around 6 million bpd in 2020 and only 4.9 million bpd in 2030, said the report.
"Three important trends come together to pose a significant challenge to Saudi Arabia's continued dependence on oil revenues," Jadwa said. "We have addressed two: the Kingdom is likely to experience only a very gradual increase in production of crude oil, and the government's spending will continue to rise at a rapid pace and rely primarily on oil revenues," the study said.
"The third of these trends is that the country's domestic consumption of energy, especially oil, at very cheap prices, is also likely to continue to rise rapidly, sharply reducing the amount of oil available for export.
"Combined, these trends paint a picture of significant future challenges for the Kingdom."
Saudi oil consumption is rising rapidly with the domestic use of crude oil averaging 2.4 million bpd in 2010, up from 1.9 million bpd in 2007 and 1.6 million bpd in 2003.
Consumption in the first quarter of 2011 was 2.9 percent higher than the same period of last year, though it declined in the subsequent two months. However, consumption is expected to peak during the summer use of air conditioning, said the study, cited in the Emirates newspaper.
Analysts said that the study had to be read alongside inherent uncertainties of the oil market, which can respond to complex conditions and cause oil prices to plummet as in the past.
Saudi development planning has faced frequent criticism because of its haphazard approach to energy efficient. Most of new construction across the kingdom is marked by heavy use of glass and concrete, while traditional architects have campaigned for years for a fusion of new and old techniques and materials, including mud, to produce energy-efficient architecture.
"The pace of consumption growth has picked up in recent years, from an annual average of 4.8 percent between 2000 and 2004 to 5.9 percent between 2005 and 2009," the study said. "If growth is maintained at this latter pace, domestic consumption of both oil and gas would reach 5.9 million barrels of oil equivalent per day by 2020 and 10.6 million barrels of oil equivalent per day by 2030."
Jadwa said the impact of the rapid growth in domestic consumption on local oil demand has been compounded by shortages of natural gas in Saudi Arabia.
Four joint ventures between Saudi Aramco and foreign oil companies began searching for gas in 2004 but the discoveries haven't been encouraging.
Saudi Arabia is also using oil to power water desalination and to generate electricity, areas that are certain to see sharp increases in consumption.
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