Watchdog warns on declining oilfield output

LONDON (Reuters) - Output from the world's oilfields is declining faster than previously thought, the Financial Times reported on Wednesday, quoting from a draft International Energy Agency report it had obtained.

The newspaper said the watchdog's annual World Energy Outlook report, which studied the biggest fields, showed that without extra investment to raise production, the natural annual rate of output decline was 9.1 percent.

The findings suggested the world would struggle to produce enough oil to make up for steep declines in existing fields, such as those in the North Sea, Russia and Alaska, and to meet long-term demand, said the Financial Times.

It said the issue would become even more acute as prices fell and investment decisions were delayed.

The International Energy Agency (IEA) acts as policy adviser to 28 member countries, including the United States, Japan, Canada and leading European nations.

The IEA forecast China, India and other developing countries' demand would require investments of $360 billion (224.5 billion pounds) each year until 2030, said the newspaper.

"The future rate of decline in output from producing oilfields as they mature is the single most important determinant of the amount of new capacity that will need to be built globally to meet demand," the IEA was quoted as saying.

The watchdog said the world needed to make a "significant increase in future investments just to maintain the current level of production."

The battle to replace mature oilfields' output could even offset the decline in demand growth, which had given the industry a reprieve in the past few months, it said.