Oil Companies Focus More on Compensating Losses Than Increasing Oil Production, Warns Report Released by IEA

Written by Rannyson Moura

Published on 16/09/2025 at 11:12

Relatório da AIE mostra que quase 90% dos investimentos em petróleo desde 2019 têm servido apenas para compensar perdas na produção, e não para atender ao crescimento da demanda. Fonte: ClimaInfo

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IEA Report Shows That Nearly 90% of Investments in Oil Since 2019 Have Only Served to Compensate for Production Losses, Not to Meet Demand Growth.

The International Energy Agency (IEA) published on September 16 the report “Implications of Decline Rates in Oil and Gas Fields”, revealing that the sector is facing a historic dilemma. According to the document, nearly 90% of the investments made since 2019 have been directed solely to offset natural production losses, not to expand supply.

The agency estimates that by 2025, investments in oil will be around US$ 570 billion. This volume would be sufficient to ensure modest growth in the coming years, but the IEA warns: any reduction could turn expansion into stagnation.

The Composition of Supply Has Changed in Recent Decades

The report highlights a significant transformation in the origin of global oil. In 2000, conventional fields accounted for 97% of global production. By 2024, this share has fallen to 77%, reflecting the rise of unconventional oil and shale gas.

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Risk of Drastic Declines Without New Investments

The IEA report is categorical: if investments were to stop today, global oil production would drop by an average of 8% per year. For gas, the reduction would be even greater, at 9% per year. The losses would equate, in the case of oil, to the annual production of countries like Brazil and Norway. In gas, they would be comparable to the production of all of Africa.

This scenario is exacerbated by the growing dependence on unconventional sources, which present much faster decline rates. In the United States, for example, shale oil and gas production could fall more than 35% in just one year without new investments.

However, dynamics vary between regions. In countries dependent on unconventional sources, like the U.S., declines could reach 65% in ten years. In the Middle East and Russia, where large conventional fields with slower declines predominate, the projected reduction is about 45%.

This concentration tends to increase global dependence on a few producing areas, raising risks to energy security and making the market more vulnerable to geopolitical crises.

The Challenge of Reserve Replacement

The IEA estimates that to maintain current production levels until 2050, it will be necessary to incorporate more than 45 million barrels per day of oil from new conventional fields. In the case of gas, the need is for an additional 2 trillion cubic meters.

Although there are significant discoveries yet to be developed, the report notes that conventional projects take, on average, nearly 20 years to come online. This means that the resilience of global supply will depend on quick investment decisions and clear regulation.

The agency emphasizes that the challenge is not only in replenishing reserves but also in balancing energy security with climate commitments. “A relatively small decline in upstream investment could mean the difference between oil and gas supply growth and production stagnation. At the same time, less investment is needed in a scenario of demand contraction,” the report highlighted.

This dilemma underscores the need for effective public policies, international partnerships, and business strategies that reconcile supply expansion with energy transition goals.

Oil Companies Focus More on Compensating Losses Than Increasing Oil Production, Warns Report Released by IEA

IEA Report Shows That Nearly 90% of Investments in Oil Since 2019 Have Only Served to Compensate for Production Losses, Not to Meet Demand Growth.

The Composition of Supply Has Changed in Recent Decades

Risk of Drastic Declines Without New Investments

The Challenge of Reserve Replacement

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Oil Companies Focus More on Compensating Losses Than Increasing Oil Production, Warns Report Released by IEA

IEA Report Shows That Nearly 90% of Investments in Oil Since 2019 Have Only Served to Compensate for Production Losses, Not to Meet Demand Growth.

The Composition of Supply Has Changed in Recent Decades

Risk of Drastic Declines Without New Investments

The Challenge of Reserve Replacement

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Egypt wants to draw 10 million cubic meters of water from the Nile per day into the desert, irrigate a new agricultural frontier, and build a city where there is currently only sand.

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Ethiopia has banned gasoline and diesel cars, placed over a hundred silent electric buses on the streets of Addis Ababa, and now aims for half a million electric vehicles by 2030, all powered by Africa’s largest dam and a courage that few countries have shown.

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