The International Energy Agency based in Paris is conducting a study of the conditions of the oil fields of the major oil producing nations - I believe the first of its kind by a respected national or international agency.   Among other things it will try to assess decline rates of existing fields and the projecte the adequacy of new supplies expected to come on the market.

The study is expected to be released in November.   In the meantime the  well respected analyst leading the study, Fatih Birol, has released an interim report that says non-OPEC oil production will peak in 2010.   This projection is consistent with other opinions such as those of Charlie Maxwell and David Strahan.

Here is the report:

From The Times

July 21, 2008

IEA warns non-Opec oil could peak in two years

Robin Pagnamenta

Oil production in non-Opec countries is set to peak within the next two years, leaving the world increasingly dependent on supplies from the cartel of exporting nations, according to one of the world’s leading energy experts.

Fatih Birol, chief economist of the International Energy Agency (IEA), said that falling production from key regions such as the North Sea and the Gulf of Mexico would leave international oil companies such as Shell and BP increasingly sidelined at the expense of national oil companies, such as Saudi Aramco.

The North Sea is one of the fastest-declining energy-rich regions in the world, with output falling by an average of 7.5 per cent a year since 2002.

“The days of the international oil companies are coming to a glorious end because their reserves are declining and they will have difficulty accessing new reserves,” Dr Birol told The Times. “In future we expect most of the new oil to come from a very small number of national oil companies.”

Dr Birol, who is leading an investigation into the condition of the world’s largest oilfields, said that the world was entering a “new oil order”.

“Demand growth is no longer coming from the US and Europe but from China, India and the Middle East,” he said. “Because their disposable incomes are growing so fast and because of subsidies, high oil prices will not have a major impact on demand growth.” This meant that prices would remain extremely high for the foreseeable future and that the fundamental dynamics of the global oil market increasingly were outside of the control of Western countries.

Dr Birol sidestepped questions over how close he thought Opec oil production could be to a peak. “Oil will peak one day, but we don’t know when,” he said. “There is a lot of oil in Opec countries and also unconventional oil … I don’t think oil will peak because of the geology … but conventional, non-Opec oil is going to peak very soon.”

He said it was imperative that governments acted urgently to reduce their dependency on oil and to address the issue of climate change. He said that the IEA would publish the results of its study of the world’s oilfields in November.

Tags: peak oil energy investments

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