The International Energy Agency (IEA) has recently charged its public position on peak oil. It now claims that output of conventional oil will peak in 2020, if demand continues to grow in a business-as-usual way:
After analysing the historical production trends of 800 individual oilfields in 2008, the IEA came to the conclusion that the decline in annual output from fields that are past their prime could average 8.6% in 2030. â€œEven if oil demand were to remain flat, the world would need to find more than 40m barrels per day of gross new capacityâ€”equal to four new Saudi Arabiasâ€”just to offset this decline,â€ says Mr Birol.
A daunting task. Peak-oil proponents point out that the average size of new discoveries has been declining since the mid-1960s. Between 1960 and 1989 the world discovered more than twice the oil it produced. But between 1990 and 2006 cumulative oil discoveries have been about half of production. Their opponents argue that long periods of relatively low oil prices blunted the incentives for exploration. A sustained period of higher prices, they argue, should increase discoveries. They point out that the first half of 2009 saw 10 billion barrels of new discoveries, an annual rate higher than any year since 2000. The pessimists retort that recent discoveries are still not enough.
Insofar as climate change mitigation policies could help control demand growth, they could thus extend the timeframe during which humanity will address fossil fuel depletion.
The IEA argues that coordinated action to prevent more than 2Â°C of climate change would reduce global demand for oil in 2030 from 105 million barrels per day to 89 million.