IEA: Faster Decline in Oil and Gas Fields Demands Urgent Investment to Maintain Supply
The International Energy Agency (IEA) has warned that the natural decline in production from the world’s oil and gas fields is accelerating, driven by growing reliance on shale and deep offshore resources.
The trend means companies must significantly increase investment just to keep global output steady.
According to the IEA’s latest analysis, without ongoing investment in existing fields, the world would lose the equivalent of Brazil and Norway’s combined oil production every year, posing major risks to markets and energy security.
“Only a small portion of upstream oil and gas investment is used to meet increases in demand, while nearly 90% is required simply to offset declining supply from existing fields,” said IEA executive director Fatih Birol.
“Decline rates are the elephant in the room for any discussion of investment needs in oil and gas, and our new analysis shows that they have accelerated in recent years.”
The report draws on production data from 15,000 oil and gas fields worldwide. It found that average annual post-peak decline rates have risen to 5.6% for conventional oil and 6.8% for conventional natural gas.
If upstream investment were halted entirely, oil supply would shrink by 5.5 million barrels per day every year, up from just under four million barrels per day in 2010. That loss is roughly equal to the combined output of Brazil and Norway.
For natural gas, the annual decline has surged to 270 billion cubic metres, compared with 180 billion cubic metres in 2010.
Increasing Dependence on Mature Fields
As of 2024, the IEA noted that 80% of global oil production and 90% of natural gas production came from fields that had already passed their peak output levels.
This growing reliance on mature fields underscores the urgent need for sustained investment to maintain production capacity.
The warning comes as the agency continues to face criticism from some governments, including the United States, for shifting its focus toward clean energy policies.
Four years ago, the IEA advised that no new oil, gas, or coal projects would be consistent with achieving global climate goals.
