GEO ExPro

Peak Oil Abandoned?

“If governments around the world stick with existing policies – the underlying premise of the World Energy Outlook Reference Scenario – the world’s energy needs would be well over 50% higher in 2030 than today,” according to the World Energy Outlook (WOE), published recently by the International Energy Agency (IEA).
This article appeared in Vol. 4, No. 6 - 2007

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A good portion of this demand has to be met by increased oil production, meaning that output in 2030 will be 116 MMbopd, up from 84 MMbopd in 2006. The majority of this, according to WOE, has to come from the Middle East countries that are flush with oil. 

So much for the Peak Oil hypothesis.
   

So where does all the new oil come from?

Again according to IEA, non-OPEC production will rise slowly over the next 25 years. Most of the increase will be coming from nonconventional sources, in particular the Canadian oil sands, with their colossal resources approaching 2.5 trillion (!) barrels (GEO ExPro, No. 5/6, 2005).

In other words, despite the heavy Canadian oil, the increase in demand has to be met by the OPEC block.

World oil output is, following the IEA study, expected to become more concentrated in a few Middle Eastern countries – if the necessary investment is forthcoming.

That does not mean that the agency is ignorant of a possible lack of petroleum resources in the future.

“Although production capacity at new fields is expected to increase over the next five years, it is very uncertain whether it will be sufficient to compensate for the decline in output at existing fields and meet the projected increase in demand”.

“A supply-side crunch in the period to 2015, involving an abrupt escalation in oil prices, cannot be ruled out,” the report says.

The message is quite simple. The International Energy Agency does not know what to say about future supply. Mark Twain was right.

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