IEA predicts global oil crisis

From the ABC:

The International Energy Agency has warned of a shortage of oil in the next five years.

It says world oil production may not be able to keep up with demand, leading to a supply crunch.

The co-author of the report, David Phife, says strong economic growth in Asia and the Middle East means the demand for oil is high, despite increasing prices.

"The older provinces of oil production in the North Sea and North America have become depleted and therefore, the companies are having to look in more technologically-challenging areas - Arctic areas, the ultra-deep water, the oil sands in Canada and Venezuela," he said.

BT Financial Group analyst Misha Collins says a global oil crisis could be a real possibility, with oil production already dropping over the past couple of years.

"The non-developed world has grown quite significantly from levels of mid-20s, 25, 26 million barrels up to around 29 and that looks to perhaps go down, while the developed world has been in decline and OPEC [Organisation of the Petroleum Exporting Countries] has been pretty much flat," he said.

Mr Collins is predicting a greater move to alternative energy sources.

"Higher prices will lead consumers of oil to look at conservation of energy and look to alternative sources of energy, particularly gas and electricity being the most common ones," he said.

(More discussion at The Oil Drum)