LONDON : In its latest report, the IAEA cautioned that without continued investment in existing fields, the world could lose the equivalent of Brazil and Norway’s combined production each year, posing serious risks to energy markets and security.

“Only a small fraction of oil and gas investments go toward meeting new demand. Nearly 90 percent is spent offsetting supply losses from aging fields,” said Fatih Birol, IAEA’s executive director. “Declining rates are the core issue in any discussion about oil and gas investment needs, and our new analysis shows they have accelerated in recent years.”

The report highlighted that global average annual decline rates now stand at 5.6% for conventional oil and 6.8% for conventional natural gas, based on data from 15,000 fields. Without fresh investment, oil supply could shrink by 5.5 million barrels per day annually, up from less than 4 million barrels in 2010, while natural gas production could fall by 270 billion cubic meters each year, compared to 180 billion cubic meters previously.

The agency noted that as of 2024, about 80% of the world’s oil and 90% of its natural gas come from fields already past their peak. It also reiterated its earlier stance that achieving climate goals requires halting new investments in fossil fuel projects, a reality that places policymakers and markets in a difficult balancing act between energy security and climate commitments.

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