Global oil reserves overestimated, media report says

AFP - The world is much closer to running out of oil than official estimates admit, but the International Energy Agency is underplaying a looming shortage for fear of sparking panic buying, a report said Monday.

The United States has played an influential role in encouraging the IEA to underplay the rate of decline from existing oil fields, the Guardian said.

The newspaper cites an unnamed senior IEA official as saying the US has also encouraged the Paris-based organisation, formed to try to safeguard energy supplies, to overplay the chances of finding new reserves.

The allegations come ahead of this week's publication of the IEA's latest World Energy Outlook on oil demand and supply which many governments use to help guide their energy and climate change policies.

The last outlook predicted that oil production can be raised from its current level of 83 million barrels a day to 105 million barrels.

"Many inside the organisation believe that maintaining oil supplies at even 90m to 95m barrels a day would be impossible but there are fears that panic could spread on the financial markets if the figures were brought down further," the official said on the newspaper's website.

"And the Americans fear the end of oil supremacy because it would threaten their power over access to oil resources," he added.

A second unnamed source, a former IEA official, said a key rule at the organisation was that it was "imperative not to anger the Americans" but the fact was that there was not as much oil in the world as had been admitted.

"We have (already) entered the 'peak oil' zone. I think that the situation is really bad," he added.

The report comes amid international debate about the sustainability of the reliance on oil for energy.