The International Energy Agency says that the world has already reached its peak oil production, a surprising conclusion that could have significant effects on future oil prices. In its annual report, the group suggests that production rates likely topped out at about 70 million barrels a day in 2006. Two years ago, the group projected that conventional oil production would likely climb slowly for decades to come.
The new analysis does not predict imminent shortages and projects that oil production will reach an “undulating plateau” of about 68 to 69 million gallons per day from 2020 to 2035. But the study says that as oil production levels off and begins to decline, global demand for liquid energy supplies will climb by 20 percent in the coming decades. That new demand will have to be met with other sources of energy, such as oil from tar sands, liquid natural gas, or biofuels, the report says.