In a new report published on Tuesday 16 September, the International Energy Agency (IEA) notes an accelerating decline in production from existing oil and gas sites, partly due to increased reliance on shale and deep offshore resources.
As a result, almost 90% of annual investment in the upstream oil and gas sector since 2019 has been devoted to offsetting the fall in production rather than meeting growth in demand.
According to the IEA, investment in 2025 should amount to around 570 billion American dollars and, if this trend continues, “moderate growth in production could be maintained in the future”.
Otherwise, “for oil, the absence of upstream investment would remove from the world market the equivalent of the combined production of Brazil and Norway each year”, IEA Executive Director Fatih Birol points out in a press release.
The IEA analysis is based on production data from around 15,000 oil and gas fields around the world, and shows an average annual decline rate of 5.6% for conventional oil and 6.8% for conventional natural gas.
It reveals that Europe, which has a very high proportion of mature offshore oil fields, has the highest rate of decline, at 9.7%. In comparison, the major onshore fields in the Middle East are declining by an average of 1.8%.
According to the IEA, maintaining current production levels by 2050 would require more than 45 million barrels per day of oil and around 2,000 billion m3 of natural gas “from new conventional projects”. However, the quantities needed could be reduced if demand fell.
In response to this analysis, the Organization of the Petroleum Exporting Countries (OPEC) stressed that, “contrary to the EU’s U-turn”, it had “always advocated timely investment in the oil industry” in order to take account of decline rates and meet growing demand.
To see the IEA report: https://aeur.eu/f/igg (Original version in French by Pauline Denys)