The International Energy Agency (IEA) has emphasized the need for new oil and gas projects to maintain current production levels, citing a decline in output from existing fields. In a recent report, the IEA analyzed 15,000 oil and gas fields and found that production is decreasing more rapidly than in the past, which has significant implications for energy markets and security.
The agency’s forecast suggests that oil demand will peak by the end of the decade, leading to considerable implications for investment in oil production. This prediction has drawn criticism from the oil and gas industry, as well as the Trump administration, which has threatened to pull out of the IEA if it does not reform its operations. The administration’s Energy Secretary, Chris Wright, has been vocal in his criticism, threatening to withdraw from the agency in July.
The IEA’s report highlights the need for careful consideration of the potential consequences of declining production on market balances, energy security, and emissions. According to IEA chief Fatih Birol, “careful attention needs to be paid to the potential consequences for market balances, energy security and emissions.” The agency has concluded that maintaining current global oil and gas production levels will require the development of new resources.
The IEA estimates that upstream oil and gas investment in 2025 will be around $570 billion, which will likely result in a small increase in production if investment continues at this level. However, the agency notes that there is a significant gap between the amount of oil and gas needed to maintain current production levels and the amount that will be produced from existing projects. This gap will need to be filled by new conventional oil and gas projects, although the amount needed could be reduced if oil and gas demand decreases.
The IEA’s report comes amid a public feud with the Trump administration over its forecasts for lower demand. The agency’s analysis suggests that the decline in production from existing fields is related to the development of less productive offshore fields and fracking. As the energy landscape continues to evolve, the IEA’s findings highlight the need for investment in new oil and gas projects to ensure energy security and meet demand. The agency’s report serves as a reminder of the complex and often competing factors that shape the global energy market.
