Oil and gas fields worldwide are declining at an accelerating pace, forcing the energy industry to dramatically increase investment just to maintain current production levels, the International Energy Agency warned Tuesday in a comprehensive analysis of 15,000 fields globally.
The IEA found that conventional oil fields decline at an average annual rate of 5.6% after reaching peak production, while conventional gas fields decline at 6.8% — both rates significantly higher than in previous decades.
Without continued upstream investment, global oil supply would drop by 5.5 million barrels per day each year — equivalent to losing the combined annual output of Brazil and Norway. That represents a sharp increase from the 4 million barrels per day that would have been lost annually in 2010. Natural gas faces an even steeper trajectory, with potential annual losses of 270 billion cubic meters, up from 180 billion cubic meters previously.
“Nearly 90% of annual upstream oil and gas investment since 2019 has been dedicated to offsetting production declines rather than to meet demand growth,” the agency said in its report, “The Implications of Oil and Gas Field Decline Rates.”
The acceleration stems largely from the industry’s growing reliance on unconventional resources like shale oil and deepwater offshore fields, which decline much faster than traditional onshore conventional fields. As of 2024, about 80% of global oil production and 90% of natural gas production came from fields that had already passed their peak output.
If all capital investment in existing oil and gas production ceased immediately, global oil production would fall by approximately 8% per year on average over the next decade, while natural gas production would drop by more than 9% annually. Under this scenario, oil production would plummet from current levels of nearly 100 million barrels per day to just 42 million by 2035.
Decline rates vary dramatically by field type and location. Supergiant oil fields — mostly concentrated in the Middle East, Eurasia and North America — decline by an average of just 2.7% annually, while small fields decline by more than 11.6%. The Middle East, with its large conventional onshore fields, has the lowest observed decline rate at 1.8%, while Europe, dominated by offshore fields, exhibits the highest at 9.7%.
In 2000, conventional oil fields contributed 97% of total global oil output, but by 2024 this share had fallen to 77% as unconventional fields gained prominence.
To maintain current production levels through 2050, the industry would need more than 45 million barrels per day of new conventional oil capacity and around 2,000 billion cubic meters of new conventional gas capacity from projects not yet approved. This would require discovering roughly 10 billion barrels of oil and 1 trillion cubic meters of gas annually — amounts slightly above recent discovery rates.
The report highlighted that conventional oil and gas projects now take an average of nearly 20 years from exploration license award to first production, including nearly a decade to discover new fields and a further decade for appraisal, approval and construction.
With upstream investment projected at around $570 billion in 2025, the IEA said modest production growth could continue if spending persists at current levels. However, the agency warned that relatively small drops in investment could mean the difference between supply growth and stagnant production.
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