November 11th, 2009

Green Right Now Reports

The world is running out of oil faster than the “official” report from the International Energy Agency suggests, according to an exclusive news report in the UK’s Guardian.

Whistleblowers, one inside the agency and one who has left the agency, say that the IEA has been downplaying the coming shortage of oil for fear of triggering a panic.

Further, the whistleblower still employed by the IEA (described as a “senior official” who wished to remain anonymous), says that the agency’s reluctance to come clean about oil supplies has been the result of pressure from the United States.

These allegations raise questions about the IEA’s prediction that oil production could be raised from its current level of 83 million barrels a day to 105 million barrels a day to meet increasing demand expected as the world comes out of the recession.

Looked at another way, the leaks from inside the IEA, which released its 2009 World Energy Outlook this week, give credence to critics who have been saying the world is close to or past the point of “peak” oil production.

The Guardian quoted the insider source as saying:

“Many inside the organisation believe that maintaining oil supplies at even 90m to 95m barrels a day would be impossible but there are fears that panic could spread on the financial markets if the figures were brought down further. And the Americans fear the end of oil supremacy because it would threaten their power over access to oil resources,” he added.

Said the Guardians’ second source:

“We have [already] entered the ‘peak oil’ zone. I think that the situation is really bad.”

The IEA report is not stripped of bad news, however. A look at the Executive Summary shows the IEA projects that:

• Oil demand will grow from 85 million barrels a day in 2008 to 105 million barrels per day in 2030 with the transportation sector accounting for 97 percent of the increase in oil use.
• Falling investment in oil and gas energy will have “far-reaching and depending on how governments respond, potentially serious consequences for energy security, climate change and energy poverty. …Any prolonged downturn in investment threatens to constrain capacity growth in the medium term, particularly for long lead-time projects, eventually risking a shortfall in supply.”

The IEA report further warns that it is important that world leaders develop a treaty at Copenhagen to reduce greenhouse gas emissions (though it talks in terms of holding the planet to 450 ppm of carbon in the atmosphere  instead of the emerging consensus for 350 ppm).

“Energy needs to be used more efficiently and the carbon content of the energy we consume must be reduced…” yet in 2030, the report predicts, fossil fuels, with the exception of coal, will remain the dominant energy sources.

For a larger discussion on peak oil, a look at the bell curves and some postulations about life on planet Earth in the post-fossil fuel era see Matt Savinar’s blog Life After the Oil Crash.