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World will struggle to meet oil demand
Carola Hoyos and Javier Blas, Financial Times
Output from the world's oilfields is declining faster than previously thought, the first authoritative public study of the biggest fields shows.

Without extra investment to raise production, the natural annual rate of output decline is 9.1 per cent, the International Energy Agency says in its annual report, the World Energy Outlook, a draft of which has been obtained by the Financial Times.

The findings suggest the world will struggle to produce enough oil to make up for steep declines in existing fields, such as those in the North Sea, Russia and Alaska, and meet long-term de-mand. The effort will become even more acute as prices fall and investment decisions are delayed.

The IEA, the oil watchdog, forecasts that China, India and other developing countries' demand will require investments of $360bn (£230bn) each year until 2030. The agency says even with investment, the annual rate of output decline is 6.4 per cent.

The decline will not necessarily be felt in the next few years because demand is slowing down, but with the expected slowdown in investment the eventual effect will be magnified, oil executives say.
(29 October 2008)

Watchdog (IEA) warns on declining oilfield output: report
Ralph Gowling, Reuters
Output from the world's oilfields is declining faster than previously thought, the Financial Times reported on Wednesday, quoting from a draft International Energy Agency report it had obtained.

The newspaper said the watchdog's annual World Energy Outlook report, which studied the biggest fields, showed that without extra investment to raise production, the natural annual rate of output decline was 9.1 percent.

The findings suggested the world would struggle to produce enough oil to make up for steep declines in existing fields, such as those in the North Sea, Russia and Alaska, and to meet long-term demand, said the Financial Times.

It said the issue would become even more acute as prices fell and investment decisions were delayed.
(28 October 2008)
The IEA later issued a statement saying that the figure of 9.1 percent output decline was from an early draft of their report and may be misleading. (Energy agency denies oil output falling at faster rate than previously thought). -BA

Energy agency denies oil output falling at faster rate than previously thought
Mark Milner, Guardian
The International Energy Agency sought to play down a report that it believes global oil production is falling at a faster rate than previously thought.

The Financial Times said a draft of the IEA's annual World Energy Outlook calculated world production would fall at a natural annual rate of 9.1% without extra investment.

The report came amid suggestions that a number of oil producing countries were finding it harder to finance new projects because of the recent sharp fall in the oil price.

"The future rate of decline in output from producing oil fields as they mature is the single most important determinant of the amount of new capacity that will need to be built globally to meet demand," the FT quoted the draft report as saying, adding that the IEA believed it would require a "significant increase in future investments just to maintain the current level of production."

The WEO is due to be published next month. The IEA said the FT article "appeared to be based on an early version of a draft from several months ago that was subsequently revised and updated."

It added: "The numbers in the article can be misleading and should not be quoted or considered to be official IEA results," the IEA said.
(29 October 2008)

IEA Statement on Unauthorised Press Coverage of World Energy Outlook 2008
International Energy Agency
The Financial Times carried a cover page article this morning and a second article on page 4 allegedly reporting on the findings of the forthcoming WEO 2008. This article was drafted without any consultation with the IEA. It appears to be based on an early version of a draft from several months ago that was subsequently revised and updated. The numbers in the article can be misleading and should not be quoted or considered to be official IEA results. We are dismayed that such a comprehensive and important IEA report was made public without our input and verification.

The IEA will present the final and accurate results of the World Energy Outlook 2008 officially as planned at a press conference in London on 12 November. At that time, we will be happy to discuss the results and their implications for the global energy and climate in full detail.
(29 October 2008)

Time for an energy bail-out
Jeremy Leggett, Guardian
Peak oil is just five years away, and we must start to plan now to avert a truly ruinous crisis
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If eight companies across a broad spectrum of UK industry had warned, five years ago, that a ruinous credit crunch would hit the global economy this year, might the government have taken the warning seriously? Might UK leadership in damage limitation have been proactive, rather than reactive? Could a softer landing and a faster recovery have been possible as a result?

Today, eight British companies are warning of a ruinous oil crunch five years from now. We warn that the global peak of oil production will arrive unexpectedly early, resulting in not just a global energy crisis, but potentially the withholding of exports by oil producers and energy famine in oil-importing countries. Previously unimaginable policy interventions in financial markets have suddenly become imperative, and similar interventions in energy markets today may be worth their weight in gold tomorrow, in terms of economic and social damage avoided, especially as this would also help tackle climate change.

The prevailing oil industry view, echoed by the government, is that there are well over a trillion barrels of proved reserves, and several trillions more in tar sands. In a world burning just over 30bn barrels a year, that means decades of supply before we need worry. But peak oil happens when flow-rate capacity coming onstream from oil discoveries fails to exceed declining flow-rate capacity from depletion of existing reserves. Peak oil is as much a problem of flow rates as it is of reserves. In our report, the consulting editor of Petroleum Review – a flagship oil-industry journal – shows how the flow rates from reported discoveries will drop below depletion rates no later than 2013, and possibly a good deal earlier.
(29 October 2008)

Falling oil production 'is greater threat to Britain than terrorism'
Daily Mail
Falling oil production 'is greater threat to Britain than terrorism' as world struggles to meet demand
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The risk to the UK from falling oil production in coming years is greater than the threat posed by terrorism, according to a new report released today.

Industry taskforce Peak Oil group warned that Britain will begin to feel the effects of a shortage of oil within the next five years, as the major oil-producing nations slow down production.

The warning comes after a new study said that the world is struggling to meet the demand for oil and will have to invest hugely in production just to maintain the current output rate.

The draft report from the International Energy Agency shows that output from the world's oilfields is declining faster than previously thought, and that without more investment the rate of annual decline is 9.1 per cent.
(29 October 2008)
Similar article in the Telegraph: Oil shortage "bigger threat to UK than terrorism".

Note: The IEA later issued a statement saying that the figure of 9.1 percent output decline was from an early draft of their report and may be misleading. (Energy agency denies oil output falling at faster rate than previously thought). -BA



Oil production predicted to decline within five years
ABC Rural (Australia)
A taskforce of eight British engineering, utility and transport companies is predicting the world will reach peak oil in three to five years.

That's when oil drillers have reached the maximum they can produce and production starts to decline,

The taskforce has given three possible options - a collapse in production, a decline, or a plateauing of production once peak oil is reached.

Taskforce chairman Dr Jeremy Leggett says even the Shell Oil company agrees with the third option, although it's less gloomy about when the plateau will be reached.

"The collapse is the worst case scenario," he says.

"The plateau scenario, interestingly, is Shell's view of what could happen.

"They think that we can get to 2015 and then maybe hold it on a plateau provided they're allowed open season on unconventional oil, tar sands and all the rest of it."
(29 October 2008)
UPDATE (Oct 29). Just added this item, which seems to be based on the interview with Jeremy Leggett (next item). -BA

UK report - peak oil will arrive much earlier than expected (audio)
Radio National Breakfast, ABC National Radio (Australia)
Now to the supply of oil, which affects us all just as much as the economic meltdown. A report from a British Industry Taskforce is due to be released tonight, which predicts a premature peak in oil production will arrive much earlier than expected. But if this task force is correct, peak oil not only poses further risk to the global economy but will have enormous repercussions on food production, energy supply, transportation -- in fact most aspects of modern life.

Guests
Dr Jeremy Leggett
Founder and Executive Chairman SolarCentury and SolarAid and editor of the report 'The Oil Crunch', from the UK's Industrial Taskforce on Peak Oil and Energy Security.
(29 October 2008)
Nothing on the Web yet about the report which will be released October 29 in the UK. Several industries are representated on the taskforce, according to this interview of Dr. Leggett. He also said that Shell Oil contributed some input. -BA