Peak oil around 2030 says IEA

An article in the Independent caused a stir recently by claiming that the International Energy Agency’s chief economist Fatih Birol had predicted peak oil in ‘about ten years’ – a radical departure from the IEA’s position to date.

Under the headline Warning: oil supplies are running out fast, the Independent’s science editor Steve Connor wrote: “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.”

If true, this would be a significant shift for the IEA. Although the Agency has for some time been forecasting a “supply crunch” around the middle of the next decade, it has always stressed that it sees this as the result of underinvestment rather than geological limits. And in its most recent long term forecast, published in the World Energy Outlook 2008, the IEA predicted output would rise to 106 million barrels per day in 2030, up from around 84 mb/d today.

Since Independent’s story was not backed up by a direct quote from Dr Birol, I asked the IEA press office for confirmation. A spokesman emailed:

“Fatih Birol feels that the article was confusing. Concerning peak oil, his position is clear and has not changed since WEO 2008. WEO 2008 said in chapter 11 (highlights page 249) that global conventional oil production will peak around 2020. The article incorrectly made it sound that the total oil production (including unconventional oil etc.) is going to peak at that time. Taking into consideration gains from unconventional oil, oil peak will be later than 2020, more around 2030. Also, oil peak can be delayed by improving energy efficiency, therefore consuming less oil and consequently producing less oil.”

Steve Connor defended his story by email, noting that his quotes were taken directly from a taped interview and claiming “It was clear my article was about conventional oil supplies”. But that distinction was evidently lost on many readers; Dr Birol was subsequently attacked in the New York Times and the Huffington Post for his apparent conversion to the early-peak-oil view.

So the IEA does not appear to have changed its position, and is not forecasting peak oil in ten years. It has, however, and for the first time as far as I am aware, named the date, if only tentatively: ‘around 2030′.

But just because the Agency’s position is now clear doesn’t mean it’s right. As I have argued before, the IEA’s WEO 2008 forecast depends on heroic assumptions about rising production from OPEC, Iraq, and non-conventionals such as the Canadian oil sands. The danger is the Agency’s “supply crunch” in 2015 turns out to be the real thing.