The International Energy Agency (IEA) stated that to maintain oil and gas production levels, new resources must be explored, as existing fields are witnessing slowdowns. This marks a significant shift from the narrative seen in 2021, where new investments are crucial for achieving net-zero targets between 2021 and 2050.
Recent years have shown that decline rates in active oil and gas fields are increasing, largely due to heavy reliance on shale and deep offshore resources, the IEA reports.
The agency faces pressure from the Trump administration to refocus on its primary mission of ensuring global energy supply security.
According to a new IEA report, the decline in oil and gas production could surpass 45 million barrels per day if the industry intends to keep current output levels steady. This would necessitate approximately 2,000 billion cubic meters (BCM) of natural gas from new traditional fields by 2050.
Even if some projects have received development approvals, new traditional oil and gas initiatives must supplement production to sustain current levels. It’s acknowledged that if the demand for oil and gas decreases, less production would be needed, the IEA notes.
Interestingly, only a small fraction of upstream oil and gas investments is aimed at meeting rising demand; roughly 90% is focused on counterbalancing supply declines from existing fields.
Billol remarked that the accelerated decline rates pose significant challenges in discussions about investment needs for oil and gas, highlighting that these dynamics endanger global energy supply.
He went on to say that in terms of oil, without new upstream investments, the combined production from Brazil and Norway could be lost from the global market each year.
