Global oil production could peak within ten years and the UK is failing to take the action necessary to deal with the threat, a government research group warned last night.

A report from the UK Energy Research Centre (UKERC) said there was a “significant risk” that, before 2020, worldwide production of conventional oil could reach its zenith and enter terminal decline.

The report said that as output from the world’s ageing oilfields sputters, crude prices will head higher and become increasingly volatile.

The price of oil fell toward $69 a barrel yesterday after data showed fuel stocks surged last week in the US.

The UKERC claimed that simply maintaining global production of conventional oil at current levels of about 75 million barrels per day would require the equivalent of “a new Saudi Arabia every three years”.

Saudi Arabia is the world’s largest oil producer, churning out 8 million barrels per day.

The UKERC noted that with oil supplying a third of the world’s energy, major discoveries such as those announced recently by BP in the Gulf of Mexico and by Petrobras in Brazil would only delay the peak by “a matter of weeks or days”.

Steve Sorrell, senior researcher at the centre, said: “In our view, forecasts which delay a peak in conventional oil production until after 2030 are at best optimistic and at worst implausible. And given the world’s overwhelming dependence upon oil and the time required to develop alternatives, 2030 isn’t far away.”

Mr Sorrell added that it was impossible to predict an exact date for when oil would hit its high point because of the tremendous geological, political and economic uncertainty surrounding the issue.

He said: “It makes no sense to provide precise forecasts of when a peak in oil production will occur. The data is unreliable, there are multiple factors to consider and a bumpy plateau seems more likely than a sharp peak. But we can say that the window is narrowing rapidly.”

The UKERC, which advises on scientific issues and was established in 2004 after a recommendation from Sir David King, chief scientific adviser to Tony Blair, then Prime Minister, said the Government needed to accelerate investment in alternative fuels and push hard for the imposition of a robust global price for carbon.

Mr Sorrell warned that without firm action to steer the world away from a reliance on hydrocarbons, “unconventional” sources of oil, such as Canada’s tar sands or projects where coal is processed into liquid fuel, would accelerate, with damaging implications for carbon emissions and the climate.

The UKERC said that more than two thirds of global production would need to be replaced by 2030 to prevent a fall in total output.

Robert Gross, head of technology and policy assessment at the UKERC, said: “The age of easy and cheap oil is coming to an end. It doesn’t suddenly come to an end — obviously it’s a gradual change — but we’re moving to increasingly difficult and expensive oil.”

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