Tuesday, 10 November 2009

IEA whistle-blower spills the beans on Peak Oil

The world is much closer to running out of oil than official estimates admit, according to a whistleblower at the International Energy Agency who claims it has been deliberately underplaying a looming shortage for fear of triggering panic buying.

The senior official claims the US has played an influential role in encouraging the watchdog to underplay the rate of decline from existing oil fields while overplaying the chances of finding new reserves.
In particular they question the prediction in the last World Economic Outlook, believed to be repeated again this year, that oil production can be raised from its current level of 83m barrels a day to 105m barrels. External critics have frequently argued that this cannot be substantiated by firm evidence and say the world has already passed its peak in oil production.

Now the "peak oil" theory is gaining support at the heart of the global energy establishment. "The IEA in 2005 was predicting oil supplies could rise as high as 120m barrels a day by 2030 although it was forced to reduce this gradually to 116m and then 105m last year," said the IEA source, who was unwilling to be identified for fear of reprisals inside the industry. "The 120m figure always was nonsense but even today's number is much higher than can be justified and the IEA knows this.

"Many inside the organisation believe that maintaining oil supplies at even 90m to 95m barrels a day would be impossible but there are fears that panic could spread on the financial markets if the figures were brought down further. And the Americans fear the end of oil supremacy because it would threaten their power over access to oil resources," he added.

A second senior IEA source, who has now left but was also unwilling to give his name, said a key rule at the organisation was that it was "imperative not to anger the Americans" but the fact was that there was not as much oil in the world as had been admitted. "We have [already] entered the 'peak oil' zone. I think that the situation is really bad," he added.
Read the full story in the Guardian

Also reported in the Telegraph...


ChrisJS said...

Great blog, I will keep an eye on it. thanks Chris

Anonymous said...

Reality has defied all that gleeful doom and gloom about peak oil from the time of the recession.

In 2016 we've been around 95mb/d for a year and just about to see Iran return to the market. That's despite Saudi Arabia's deliberate policy of driving down the price to try to kill off US shale production.

Mike Pepler said...

The fact is that conventional oil DID peak around 2005. The extra production has come from other sources such as tar sands, shale oil, deep-water, etc. But these are only economic at high prices, which we don't have currently. As a result, oil producers are laying off staff and halting investment - this lines us up for a decline in supplies in the next few years. As a result, the 'all liquids' peak will end up being caused by a combination of geological and economic factors. Who knows, maybe 2015 or 2016 will be the overall peak year?