Global oil production is set to sputter by 2010, with a lack of fresh investment and the depletion of oil fields likely to trigger another big spike in prices, the International Energy Agency said yesterday.

In its 2008 World Energy Outlook, the Paris-based IEA predicted a 45 per cent increase in global primary energy demand by 2030, with about half of the total coming from China and India. But despite this surging demand, it said that production of crude oil would struggle “as almost all the additional capacity from new fields is offset by declines at existing fields”.

In the report, which will be published next week, the IEA said that conventional crude production would only increase by about five million barrels a day by 2030, up from 84 million in 2007 but predicted that total global oil production would increase to 106 million barrels a day by 2030.

However, the bulk would come not from conventional crude but from costly new technologies, such as the conversion of natural gas into liquid fuels, or the processing of Canada's bitumen-rich sands into synthetic crude.

This lack of sufficient production to meet demand is likely to contribute to a steep rebound in oil prices from present levels to hit an average of more than $100 a barrel between now and 2015 and $200 a barrel by 2030.

The IEA said that the world was not yet facing an outright shortage of oil but more a lack of investment. It said more than $26 trillion (£17,000 billion) would need to be spent over the next 20 years to ensure the world has enough energy.

“There remains a real risk that underinvestment will cause an oil supply crunch in that timeframe,” the report said. “The gap now evident between what is being built and what is needed to keep pace with demand is set to widen sharply after 2010.”

Jeremy Leggett, chief executive of Solarcentury, the renewable energy group, and chairman of the UK's Peak Oil Taskforce, disputed the IEA's findings. He said there was a grave risk that global production would fall far faster than the IEA had predicted, adding that governments needed to mobilise “as if for war” rapidly to diversify from the dependency on oil.

The IEA also used its World Energy Outlook, a key information document for policymakers in 28 of the world's wealthiest countries including the UK, to call for a global “energy revolution” to head off both a supply crunch and the threat of catastrophic climate change it said was increasingly acute.

“The world's energy system is at a crossroads. Current global trends are patently unsustainable — environmentally, economically, socially,” it said. “But that can and must be altered: there's still time to change the road we are on.”

However, the report said that without radical change, the world was facing an increase in temperatures of 6C. “Preventing catastrophic damage ultimately requires a major decarbonisation of energy sources.”

It said renewable energy would grow by about 7.2 per cent and would overtake gas to become the second-largest source of electricity after coal by 2010.

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