Uk Report Warns Of Oil Shortage

A new report by a prominent energy research firm warns that the world'soil supply could start to dry up over the next 10 years. In a reportunveiled at an International Energy Agency meeting in Paris, the UKEnergy Research Center said petroleum production is likely to peak bythe year 2020 leading to global shortages as supplies taper off.  

Theworld's demand for oil is unsustainable. That's the warning from a newreport delivered at the International Energy Agency's ministerialmeeting in Paris.  

Steve SorrellAccording to the U.K. Energy ResearchCentre, world oil production is likely to peak before 2030. Thereport's author, Steve Sorrell, says the global supply could start todry up sooner.

"The basic physical features of the resource meanthat production will start to decline at some point and will continueto decline and no amount of investment is going to turn that processaround," Sorrell said. "Ten years, 15 years, even 20 years is notfar away."

The meeting of energy ministers from the 28 IEAmember countries is looking at key energy challenges facing the worldtoday. IEA executive director Nobuo Tanaka's says among them, higherprices.  

"Already cheap energy price age is over," he said. "Cheap oil age is over. That is our message."

Theworld currently produces about 85 million barrels of oil per day. Estimates show production will rise to over 100 million barrels beforeoil resources begin to run out.

But some research groups say production will be sufficient well into the 21st century.

And some oil companies argue new fields discovered in Angola, Brazil and the Gulf of Mexico should be able to satisfy demand.

Sorrelldisagrees.

"Even if you assume and make optimistic assumptions aboutthe size of the resource, you assume that the investment takes placeand these areas are open to access, the evidence still points toconstraints within this period of time," he said.

Although therecession and the popularity of fuel efficient vehicles has reduceddemand in the United States, OPEC (the Organization of Oil ExportingCountries) says demand for oil is growing faster than anticipated dueto an improving global economy and increased consumption in developingcountries.