Spare Capacity (2003) and Peak Production in World Oil

Reliable estimates of minimum spare capacity for world oil production can be obtained by comparing production statistics before and following the collapse of the Iraqi oil industry in March 2003. Spare production was at least 3.2 M b/d (million barrels/day), and was concentrated in the Middle East, mostly in Saudi Arabia (1.7 M b/d), but also in Kuwait and the UAE. This indicates that, assuming Iraqi production returns to its prewar level, a peak in world oil production resulting from resource constraints alone (ignoring political factors) before 2008 can be rejected. This also implies that with an invigorated Iraqi industry, and with further increases in production in the Former Soviet Union and other non-OPEC areas, there would be significant short-term downward pressure on oil prices and strains within OPEC. These transient issues do not alter the projection for a resource-constrained peak or plateau in non-OPEC production between 2010 and 2018.