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IEA report on oil gets angry Opec reaction
Robin Pagnamenta, Times (UK)
Opec has made a scathing attack on a report from the International Energy Agency which says that the world’s existing oil producers face a “huge challenge” to keep up with a projected rise in global demand.
… Abdullah al-Badri, Opec’s secretary-general, gave a withering verdict on the study. “I don’t trust this report,” he said. “I don’t think the IEA is equipped to review these oilfields…I don’t see how it will be useful.”
He said that Opec, the cartel of 13 oil-exporting countries that produces 40 per cent of the world’s oil, had not been involved in drafting the study, which he dismissed as alarmist. “We have the reserves, we have enough oil for the foreseeable future,” Mr al-Badri insisted.
Speaking at the London launch of the IEA’s 2008 World Energy Outlook report yesterday, Nobuo Tanaka, the agency’s executive director, a leading energy expert, adopted a markedly different tone, sounding a grave warning about the energy challenges facing the world.
… The dispute between the IEA and Opec goes to the heart of the debate over “peak oil” and how much of the world’s energy needs its existing oilfields can supply in the years ahead. This year’s World Energy Outlook report slashed its assessment of how much oil the world would be able to produce by 2030 by ten million barrels to 106 million per day and placed more emphasis than ever before on the need to develop alternatives.
(13 November 2008)
International Energy Agency raises the alarm on energy future
Jerome a Paris, Daily Kos
The International Energy Agency has published its World Energy Outlook today, and, as had been promised in leaks over the past few months, it marks a significant change of tone from their previously highly optimistic forecasts. Beyond a spectacular drop in their forecast for oil production in 2030 (from 116mb/d in last year’s report to 106mb/d this time round), what is most striking is the tone of their executive summary and their conclusioons for the press. (Not all their report is consistent with that tone, a sign of the ferocious fight that must have taken behind the scenes as to the content to be included). The Oil Drum will be posting detailed analyses of the report over the next several days (I will contribute the opus on renewable energy), but I thought I’d prpvide here just a snapshot of the report.
For this purpose, I am using simply the content of the last slide from the presentation provided to the press (pdf) today:
The warning could not be any clearer:
Current energy trends are patently unsustainable —socially,
environmentally, economically
“Patently unsustainable” – that’s pretty strong wording. But there’s more.
Oil will remain the leading energy source but…
- The era of cheap oil is over, although price volatility will remain
- Oilfield decline is the key determinant of investment needs
- The oil market is undergoing major and lasting structural change, with national companies in the ascendancy
There are several hard truths in there, again: (i) prices are on a long term uptrend (in fact, the IEA expects above $100 oil for 2010-2015, and $200 oil for 2030) which we need to take into account when planning infrastructure for the long term – periods of lower prices, like right now, should not blind us to that reality; and (ii) this is driven by increasing oil scarcity. The words “peak oil” are not to be seen as such, but the concept permeates the report: existing capacity is in decline; non OPEP production will, at best, be stagnant, and sustaining production will require staggeringly huge investments – all points to easy oil being a concept of the past.
(12 November 2008)
Interview with IEA’s Fatih Birol (text and audio)
Stephanie Kennedy, ABC (Australia)
Dire warning from global energy organisation
—
… STEPHANIE KENNEDY: The International Energy Agency’s annual report card on the state of the world’s energy sources is an ominous warning. It predicts that energy demands will grow by 45 per cent by 2030 and warns that current trends in supply and consumption are unsustainable and must be changed.
Without investing over $4-trillion over the next 20 years in infrastructure and new energy sources the outlook for the global climate is catastrophic.
The organisation’s chief economist is Dr Fatih Birol.
FATIH BIROL: The current trend we are in is an unsustainable one. With the current policies we are perfectly in line with the trajectory which would lead us up to six degrees Celsius increase in the Earth’s temperature.
If we do not change our policies substantially and as soon as possible, I think it will be too late to make major changes in our greenhouse gas emissions.
STEPHANIE KENNEDY: So what needs to be done?
FATIH BIROL: I think the energy sector is key here because energy sector is responsible more than two-thirds of the emissions. So we here to change the way we use, we consume and we produce energy.
(1X November 2008)
IEA’s annual report paints grim picture of our energy future
John Timmer, Ars Technica
The International Energy Agency is comprised primarily of EU countries, as well as the US, Canada, Japan, Korea, Australia, and New Zealand. As part of its function, it prepares an annual report that peers into the future of the energy market. Its latest take on things was introduced Wednesday in London. Although some of its predictions have been toned down in light of the current economic slowdown, the report concludes that it’s going to be extremely difficult and expensive to ramp up fossil fuel production to meet our needs, meaning the era of cheap oil really is over.
The report is a 585-page monster that looks ahead at how energy markets develop out to 2030. A couple of major messages stand out. The first is that the energy demand in the industrialized nations of the IEA are expected, through increased efficiency measures, to largely stabilize. Unfortunately, China and India alone are expected to account for about about the same amount of energy that IEA members currently use; the rest of the world will require an equal amount. The net result is a 45 percent increase in demand by 2030—down a bit from last year’s estimate, but still pretty substantial.
The world, as a whole, would love to meet that demand with oil, but doing so is going to be essentially impossible. Tracking production trends of existing oil fields shows that the average yield is dropping by nearly seven percent annually, and that trend is likely to accelerate over the coming years. Offsetting this decline will require a staggering amount of new capacity…
(12 November 2008)
