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EIA predicts declining world oil output, rising oil prices

Differs from earlier estimates

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The Energy Information Administration (EIA) recently released its annual International Energy Outlook, which projects less oil output and higher oil prices by 2030 than predicted even last year (via TomDispatch and Grist). Simultaneously, the report predicts a significant rise in production of “unconventional liquids” such as “oil sands, extra-heavy oil, biofuels, coal-to-liquids, and gas-to-liquids.”

According to TomDispatch:

For the first time, the well-respected Energy Information Administration appears to be joining with those experts who have long argued that the era of cheap and plentiful oil is drawing to a close. Almost as notable, when it comes to news, the 2009 report highlights Asia’s insatiable demand for energy and suggests that China is moving ever closer to the point at which it will overtake the United States as the world’s number one energy consumer. Clearly, a new era of cutthroat energy competition is upon us.

The blog reports that the world produced 81.5 million barrels of oil per day in 2006, and that the following year, the EIA predicted that production would rise to 107.2 million barrels per day—an additional 25.7 million barrels—by 2030. However, the EIA now projects that number to be 93.1 million barrels—an increase of 11.6 million barrels from 2006, but less than half the increase the agency predicted just two years ago. Over the same time, it predicts that production of unconventional liquids will rise from 4.5 million barrels per day in 2009 to 13.4 million barrels per day in 2030.

The 2009 report also projects a significant increase in oil prices. In 2008, the EIA predicted that prices would hit just $72.30 per barrel by 2030. This year, the agency expects oil prices to climb to $130 per barrel over the same time frame.

Earlier this year, the EIA projected that US greenhouse gas emissions, which fell sharply as a result of the recession, would not recover to 2007 levels until 2024. However, climate expert Joseph Romm disputed those figures and argued that US greenhouse emissions would never again reach 2007 levels, saying that the EIA is “incredibly conservative from a forecasting perspective.”

Exxon recently indicated that it expects US gasoline consumption to drop 22 percent in the next 20 years, while analysts at Raymond James & Associates, Inc. in Houston believe that the world hit peak oil by early 2008.

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