Freddy Hutter, TrendLines Research

Pay Attention to Oil Decline Rates

At TrendLines Research, we track the 20 recognized forecasts of future crude production. Based on the group's Average, our June Update projects that Peak Oil will occur in 2028 @ 95-mbd (compared to 86-mbd in 2008).

Our own model, the Scenario-2300, is based on Underlying Decline Rates (UDR) of 4.2% in the USA, 2.5% in Saudia Arabia and 3.8% on the global scale. UDR became significant in 1999 and our analysis reveals that it is increasing world wide by 0.35-mbd/yr.

During these past 10 years, the Industry has brought aboard 26-mbd of new capacity. 10-mbd has increased the production rate & 16-mbd has been lost to addressing the Underlying Decline factor.

As the UDR continues to grow towards 8%, it will be increasing more difficult for the Industry to exceed the Supply undercut in mature and retired fields. My own model predicts that the crossover will occur in 2029 when flow will Peak @ 94-mbd.

Our oil production, reserves & price charts may be viewed at www.trendlines.ca