Forecasting World Oil and Gas Production Under Strong Economic Constraints
By Jean Laherrère in Energy Politics Archives Spring 2009
In this edition of our working history series, Energy Politics revisits an article on forecsting oil and gas supply under constraint. Veteran geophysicist Jean Laherrère offers a sobering yet meticulous assessment of global hydrocarbon production capacity under physical and economic limits. Drawing on decades of experience and proprietary exploration data, Laherrère challenges conventional wisdom by questioning the integrity of official oil and gas statistics, highlighting the deep uncertainties that plague reserve reporting, particularly in OPEC and FSU states. His argument is stark: optimistic forecasts by agencies like EIA and IEA are founded on politically filtered or unaudited numbers, and Hubbert-style linear projections are inadequate given the complex multi-cycle nature of global discoveries.
By combining creaming curves and cumulative discovery analyses, Laherrère forecasts a long, undulating oil plateau peaking below 90 million barrels per day, with conventional crude having already peaked in 2006. His NG production forecast is similarly constrained, peaking around 2025. Crucially, he emphasizes that the bottleneck is no longer geological—plenty of resources remain underground—but infrastructural, geopolitical, and economic. Above-ground constraints, from political instability to underinvestment, now determine the shape of supply curves.
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Jean Laherrère’s forecast—suggesting a global all-liquids peak around 2015 at ~90 million barrels per day (Mb/d)—has clearly missed the mark in hindsight. As of 2023, global oil production has surpassed 100 Mb/d, with post-COVID rebounds and expanded NGL and unconventional supply growth outpacing earlier depletion-based predictions. There are several reasons his projections underestimated total supply:
1. Underestimation of Above-Ground Adaptation Capacity
Laherrère emphasized below-ground physical limits and assumed significant constraints on unconventional oil (e.g., tar sands, shale oil, GTL, CTL). But in practice, technological improvements (like horizontal drilling and hydraulic fracturing) and high prices incentivized massive upstream investment, particularly in the U.S. shale patch. Projects once deemed "uneconomic" became viable far faster than anticipated.
2. Misreading of Liquids Composition Trends
His model separated “cheap oil” (conventional crude less EH) from “expensive oil” (NGLs, synthetic, biofuels), predicting their contribution would grow too slowly to offset conventional decline. Yet, what occurred instead was a compositional shift: non-crude components like NGLs, biofuels, and refinery gains now make up a larger share of the liquids basket—more than 15 Mb/d in recent IEA data. His peak forecast didn’t account for this supply heterogeneity.
3. Underappreciation of Global Investment Cycles and Resilience
Laherrère rightly emphasized underinvestment risk, but over the 2010s, global upstream investment surged—particularly in deepwater, U.S. tight oil, and Middle Eastern capacity expansion. Emerging producers (Guyana, Brazil, UAE) exceeded expectations. Institutional inertia and high oil prices around 2011–2014 enabled these projects to come online just in time to push the peak further out.
Summary
Laherrère’s methodology—rooted in geophysical determinism and conservative discovery trend extrapolation—offered a useful antidote to techno-optimism. But it underestimated how flexible, financialized, and politically driven modern energy systems had become. Rather than a clear peak, we have entered a prolonged plateau driven not by geology alone, but by policy, price signals, and modular supply technologies.
This chart compars Jean Laherrère’s forecasted global all-liquids oil production peak (~90 Mb/d around 2015) with actual IEA/EIA production data through 2023. As shown, actual production continued to rise past the projected peak, crossing 100 Mb/d by 2023, despite temporary dips during COVID-19.
Reference to Peak Oil
The concept of Peak Oil—the point at which global oil production reaches its maximum rate before declining—was first popularized by M. King Hubbert in 1956. Laherrère's work extended Hubbert’s geophysical modeling with more nuanced data, but both share the assumption that production trends mirror discovery trends. While this logic held for conventional crude, the rise of NGLs, unconventional oil, and synthetic fuels has postponed the anticipated global peak, at least for now
Where to Now?
The implications of Laherrère’s analysis are profound. First, the era of smooth energy transition narratives must confront a hard reality: even if unconventional resources abound, turning reserves into usable supply requires time, capital, and stability—commodities in short supply. As we approach a precarious plateau in both oil and gas output, energy systems will become more vulnerable to price volatility and regional supply shocks. The path forward must prioritize robust demand-side efficiency, strategic reserves rethinking, and transparent data reform.
Second, Laherrère’s call for global standardization in reserves reporting and open access to field-level data is more urgent than ever. Institutions like the IEA, BP, and national agencies must reconcile their metrics and definitions to avoid policy blind spots. Without this baseline clarity, discussions around peak oil, investment needs, or even the viability of climate scenarios remain speculative. The age of easy oil is gone—but the age of responsible forecasting has yet to fully begin.
ABOUT THE AUTHOR:
Jean Laherrere was a member of the Safety Panel of the Ocean Drilling Program (JOIDES). He was President of the Exploration Commission of the Comité des Techniciens of the Union Française de l’Industrie Pétrolière of a dozen manuals. In addition, he served as director of Compagnie Génerale de Geophysique, Petrosystems and various TOTAL subsidiaries. After 37 years of worldwide exploration with TOTAL, he retired in 1991.He is now writing articles and giving lectures. He has written several reports with Petro consultants and Petroleum Economist on world’s oil and gas potential and future production. He was a member of the "Society of Petroleum Engineers/World Petroleum Congress ad hoc Committee on joint definitions of petroleum reserves" and also a member of the task force on "Perspectives Energie 2010-2020" for the "Commissariat Général du Plan". Jean Laherrere ASPO France.jean.laherrere@nordnet.fr
Reprinted from CLUB DE NICE Energy & Geopolitics 7th Energy & Geopolitics Forum Energy relations between Europe and Russia: from difficult dialogue to vital partnership 12-14 November 2008 with the permission of Jean Laherrere