A Peak Oil “Warning” from the IEA
A Peak Oil “Warning” from the IEA
By Ian Cooper | Tuesday, November 11th, 2008
What does it mean when a usually conservative International Energy Agency (IEA) issues a gloomy report?
It means that recent cheap oil isn’t going to last – and that $100 oil will soon be a part of our daily lives… again.
The IEA is warning that crude oil will average about $100 between 2008 and 2015 because of an unavoidable energy crunch. And that the biggest cause of that crunch is “under-investment” in new and existing fields, which are needed to make sure oil production can keep pace with growing demand and slowing supply.
The agency also believes that the world needs to invest some $350 billion a year through 2030 to keep up with oil depletion rates. They’re claiming that current oil reserves are falling nine percent a year, as compared to three to five percent forecasts from analysts.
So, consider this.
If the world is using about 86 million barrels of oil everyday, a depletion rate of nine percent would mean that we’d need to find and produce another 7.7 million barrels a day just to remain at breakeven.
That’s like saying we need another Saudi Arabia, which is delivering a little more than nine million barrels a day after recent cutbacks.
Worse, the International Energy Agency outlook report, being released tomorrow—November 12—reveals that the world will eventually need to increase its production by “64 million barrels a day, or the equivalent of six times the current production of Saudi Arabia.”
