IEA warns of 50% oil price rise by 2030

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IEA warns of 50% oil price rise by 2030

The International Energy Agency, the oil sector monitoring body, on Wednesday said that oil prices by 2030 would be 50 per cent higher than today if Saudi Arabia did not muster the political will to invest billions of dollars in new production.

Fatih Birol, the group's chief economist, said in an interview with the Financial Times that Saudi Arabia, the most important oil producer, might not make the investment needed to ensure production met the strong demand growth in China and India.

"It is not a problem of availability of reserves or capital. We need to be sure that the increase in production will be high enough and a sustained production capacity increase policy is in place. That will need sustained political will," he said. Saudi Arabia has plans to invest $14bn to raise output capacity from 11m barrels a day to 12.5m b/d by 2009, according to a report by Samba Financial Group, a Riyadh-based bank.