In November 2008 IEA published this review. What was unique was the fact that they for the very first time had evaluated the oil supply situation. All earlier "analysis" always had focused on the demand side and then supply simply in the analysis had been adjusted to accommodate for these numbers. Not this time. What then became evident was the fact that it is not oil demand destruction that can become an issue for the markets, rather it is from now on all about oil supply destruction.
The prospect of accelerating declines in production at individual oilfields is adding to these uncertainties. The findings of an unprecedented field-by-field analysis of the historical production trends of 800 oilfields indicate that decline rates are likely to rise significantly in the long term, from an average of 6.7% today to 8.6% in 2030. “Despite all the attention that is given to demand growth, decline rates are actually a far more important determinant of investment needs. Even if oil demand was to remain flat to 2030, 45 mb/d of gross capacity – roughly four times the current capacity of Saudi Arabia – would need to be built by 2030 just to offset the effect of oilfield decline”, Mr. Tanaka added.
http://www.iea.org/Textbase/press/pressdetail.asp?PRESS_REL_ID=275
Lets repeat that "Even if oil demand was to remain flat to 2030, 45 mb/d of gross capacity – roughly four times the current capacity of Saudi Arabia – would need to be built by 2030 just to offset the effect of oilfield decline".
Getting that amount of new oil online obvious is a huge challenge. An even bigger challenge however is the fact this is oil that is not possible to bring on line in the first place.
Worldwide discovery of oil peaked in 1964 and has followed a steady decline since. According to industry consultants IHS Energy, 90% of all known reserves are now in production, suggesting that few major discoveries remain to be made.
http://www.oildecline.com/
In the midst of the ongoing finance debacle this issue has been completely ignored by analyst and mainstream media. Then also let's acknowledge the fact oil demand is not flat today rather world oil demand is expected to increase some 1.6%.
"On the demand picture, the report provided the IEA’s first forecasts for next year, suggesting that world demand for crude will rise 1.6 per cent, entirely because of growth in the developing world, particularly Asia. While demand in industrialized countries is forecast to fall 0.3 per cent, this will be more than counterbalanced by growth of 3.6 per cent in the rest of the world."
http://www.ft.com/intl/cms/s/67b72974-ad27-11e0-a24e-00144feabdc0,Authorised=false.html?_i_location=http%3A%2F%2Fwww.ft.com%2Fcms%2Fs%2F0%2F67b72974-ad27-11e0-a24e-00144feabdc0.html&_i_referer=http%3A%2F%2Fanyforum.se%2Foljesnack#axzz1SEWENjhz
Then important to note is the fact that you need to differentiate between declining future oil production and declining oil exports. Bottom line – as the oil producing countries themselves to an increasing extent use more and more of the oil they produce for their domestic needs less oil then is exported. Combine the oil producing countries in Russia, OPEC and Mexico and you have an oil market twice as large as the Chinese oil consumption. Thus the phase at witch oil exports declines is very much more aggressive than the pace at which oil production declines.
If the team's middle case for production and consumption holds, then net exports from the current top five exporters will dwindle to zero by 2031.
http://scitizen.com/future-energies/jeffrey-brown-and-the-net-oil-exports-crisis_a-14-2559.html
This IS the reason our current monetary system where money is created as debt has become totally unsustainable. Debt in order to be able to pay it back requires economic growth. With less available oil economic growth is not possible. Exit debt based monetary system.
Regardless then of what new system that will be introduced to replace it, gold base, fiat etc in all cases the fundamental underlying real currency in fact is oil. This as ALL economic activity depends on it.
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