Security of energy supply: a goal worth pursuing
In this third edition of IOGP’s Global Production Report, we see a continuing rise in demand for oil and gas across most of the world. In many – if not all – regions, production is also rising.
Based on the latest BP Statistical Review of World Energy, published in June 2019, this report draws its conclusions from 2018 data.
It shows that:
- Global demand for oil and gas are at their highest levels ever, with particularly dramatic growth in Africa, Asia Pacific, the Middle East and the Americas.
- Regarding security of supply, the Middle East and the CIS regions remain big exporters, while Europe and Asia Pacific have to import the majority of their oil and gas. Meanwhile, the Americas are approaching oil and gas independence while Africa could become an importer within a decade.
- Field depletion is of growing concern as demand for oil and gas continues to rise
(see page 34 for more details).
IOGP has more than 80 Members, which collectively produce in excess of 40% of the world’s oil and gas. They operate in each of the regions covered in this report: Africa, Asia Pacific, the CIS, Europe, the Middle East, North America and Central and South America. This report, like its predecessors, looks at regional production and demand figures for both oil and gas.
For each fuel in each region, the specially-devised IOGP Production Indicator© shows to what degree a region can meet its own demand through indigenous production.
IOGP continues to be grateful for the data and insights that our Members have provided for this report. Once again, it shows how for long-term prosperity and security of supply, the world needs further investment for responsible oil and gas production in each of the seven regions covered.
The last word: investment
While the rest of this IOGP Global Production Report looks back to recorded production and demand, this page considers the implications of oil and gas field depletion – which can only be remedied by continuing investment in exploration and production.
As this report shows, some regions such as Europe and Asia Pacific have become increasingly dependent on imported oil and gas. This is caused by diminishing production and/or soaring demand. Global oil demand in 2018 was 30% higher than it was in 2000; natural gas demand increased even more dramatically by 60% during the same period.
Will this trend continue?
According to two out of three of the International Energy Agency’s (IEA) scenarios for the decades ahead, it will. And even in the third scenario, in which the use of energy actually falls, oil and gas would still meet just under half of demand. Each of these scenarios is worth looking at in more detail in the context of depletion.
As the IEA said about oil in its World Energy Outlook 2018: “The natural decline rate is the drop in production from all currently producing fields that would occur if capital investment were to cease immediately.“ If that were to happen, global oil production in 2040 would be just above 15 million barrels per day. Thus, not investing in oil is not an option – not even when the demand goes down. The same holds true for gas.
The graphs below show the impact of depletion on oil and gas production without new investment.