IEA Sees Oil Rebounding to Average $100 Through 2015

By Grant Smith

Nov. 6 (Bloomberg) -- The International Energy Agency, an adviser to 28 nations, said it assumes oil import prices will rebound to average $100 a barrel between 2008 and 2015 and said the threat of a ``supply crunch'' remains.

The agency cut its global oil demand estimate for 2030 by 10 million barrels a day, to 106 million barrels, ``reflecting mainly the impact of much higher prices and slightly slower GDP growth,'' in an executive summary of its annual World Energy Outlook today. The full report will be published on Nov. 12.

``There remains a real risk that under-investment will cause an oil-supply crunch'' by 2015 as the decline in output from mature oilfields speeds up, the Paris-based adviser to 28 oil-consuming nations said. ``The current financial crisis is not expected to affect long-term investment, but could lead to delays in bringing current projects to completion.''

The agency raised its forecast for the world's energy investment needs from 2007 through to 2030 by more than $4 trillion to above $26 trillion. The world will require another 64 million barrels a day of oil capacity as declining production in existing fields accelerate to 8.6 percent from 6.7 percent currently, the IEA said.

Global energy demand, including oil, natural gas and coal, is set to grow 1.6 percent a year in that period, according to the summary.

Oil Prices

Oil prices, which have dropped by more than half from a record $147.27 a barrel in July, may exceed $200 a barrel in nominal terms in 2030, the agency said. Global oil demand growth will average 1 percent a year in the period, with all of the increase coming from developing economies.

OPEC's share of the world oil market, provided those nations invest in new supply, will rise to 51 percent in 2030, from 44 percent last year, the IEA said. Production ``has already peaked in most non-OPEC countries and will peak in most others before 2030,'' it said.

Saudi Arabia, the largest member of the Organization of Petroleum Exporting Countries, is projected to pump 15.6 million barrels a day in 2030, the agency said. The kingdom produced 9.35 million barrels a day last month, according to Bloomberg estimates.

To contact the reporter on this story: Grant Smith in London at gsmith52@bloomberg.net