A false picture of world's oil reserves?

World Energy Outlook 2009 report from the International Energy Agency

TEXT OF INTERVIEW

Bill Radke: The International Energy Agency is scheduled to release its World Energy Outlook today. Meantime there are charges this morning that the agency's figures are false. And that the world is much closer to running short of oil than the IEA lets on. That's a claim in this morning's Guardian newspaper in London. Joining us live from London now, Marketplace's Stephen Beard. Good morning.

Stephen Beard: Good morning, Bill.

Radke: Stephen, what are the details of what the Guardian is reporting?

Beard: The paper says that the IEA's reports on oil and gas reserves, which are widely followed by government's around the world, are not to be trusted. The paper says that it's spoken to a whistle-blower at the agency, a senior official speaking anonymously, and he says the agency has deliberately underplayed the rate of decline in oil and gas reserves.

Radke: And what would be the IEA's motive in doing that?

Beard: The whistle-blower says the agency has been pressured to do this by the U.S. American officials, allegedly, were afraid that the true picture of the reserves would cause panic buying, and could hit stock markets... because the world would then realize we're going to hit constraints on oil supplies much sooner than expected.

Radke: So what does the whistle-blower say about the real picture of oil reserves?

Beard: Well the IEA in its last World Outlook forecast that oil production would not peak until the year 2030, and then it would reach 105 million barrels a day, sufficient to meet anticipated demand. The whistle-blower says many people in the agency believe that is false, that the world will struggle to pump 95 million barrels a day at best. And it will reach that peak earlier than expected. I called the agency in Paris this morning. Nobody was available to comment on the Guardian's story.

Radke: OK. Marketplace's Stephen Beard joining us live from London. Thanks, Stephen.

Beard: OK Bill.

About the author

Stephen Beard is the European bureau chief and provides daily coverage of Europe’s business and economic developments for the entire Marketplace portfolio.

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