Major oil fields already in decline

The chief economist of the International Energy Agency (IEA) in Paris is sounding the alarm that Peak Oil may be closer than people have been thinking:

"In an interview with The Independent, Dr Birol said that the public and many governments appeared to be oblivious to the fact that the oil on which modern civilisation depends is running out far faster than previously predicted and that global production is likely to peak in about 10 years – at least a decade earlier than most governments had estimated.

But the first detailed assessment of more than 800 oil fields in the world, covering three quarters of global reserves, has found that most of the biggest fields have already peaked and that the rate of decline in oil production is now running at nearly twice the pace as calculated just two years ago. On top of this, there is a problem of chronic under-investment by oil-producing countries, a feature that is set to result in an 'oil crunch' within the next five years which will jeopardise any hope of a recovery from the present global economic recession, he said.

In a stark warning to Britain and the other Western powers, Dr Birol said that the market power of the very few oil-producing countries that hold substantial reserves of oil – mostly in the Middle East – would increase rapidly as the oil crisis begins to grip after 2010."

Read the full article here.

At least this is the first admission I've seen that governments recognize that oil is running out. Even if they thought they had ten more years than IEA thinks.

Comments

[John Sweeney]

Well, this is from the IEA, really a group of academics. Traders and producers don't begin to think this. If they did, they'd be out their drilling like crazy. Given the recent experience with natural gas drilling just in the States, there's no way to judge how much oil is in existing fields, let alone any new fields.