RIYADH, April 19: The International Energy Agency is striving to evaluate the remaining lives and reserves of 400 major oil producing wells in the world. The analytical report is aimed at curtailing debate on the issue of actual remaining global crude reserves.

With opinion varying to a great degree on the quality and the reliability of the strategic reserve data of major producers, this report could go a long way towards settling the issue – so crucial to the global energy future.

The IEA finding would be released in November when the global body would unveil its World Energy Outlook – 2008, says Mr Nobuo Tanaka, the Executive Director of the Agency while giving a talk at the International Energy Forum Secretariat (IEFS) in Riyadh.

In an era where the world is beset with claims and counter claims about the production capacity of some of the super giant wells, especially those located in the Middle East and some analysts are openly questioning the reliability of reserve data released by the governments and the national oil companies.

The attempt by the IEA, the OECD energy watchdog, to decipher the life cycles of the producing wells is a gigantic and to some extent a controversial task in itself. It is not going to be easy and smooth sailing altogether.

Explaining the reasons behind the galloping oil prices, Mr Tanaka conceded that no one factor could be held responsible for the current woes of the crude markets.

However, despite the fact that some may not agree to the hypothesis, yet he went on to underline it was still the demand and supply factors and the energy markets are no different in this respect, citing lack of enough spare capacity as one major cause.

Mr Tanaka noted that weak dollar and speculation had also contributed to the firming up of the crude markets, yet he made it clear that prices had shot up in virtually all the currencies, and not just in dollars, clarifying that weakening dollar could not only be blamed for it.

He said that though oil consumption in major industrial countries had been virtually stagnant, it seemed to have gone up considerably in countries where the oil was subsidised.

Fatih Birol, IEA chief economist who accompanied Mr Tanaka to Riyadh, explained that in principle when market prices went up the demand fell. That was the case during the earlier two ‘oil shocks,’ in 1973 and 1979. But this time around, despite the prices were going up, the total global demand had not gone down.

The IEA chief economist emphasised that oil consumption was growing rapidly in China, the Middle East and India where oil prices were heavily subsidised to the tune of $50 billion delineating a direct relationship between increasing crude consumption and oil subsidies in these countries.

The IEA appeared also strongly contributing to the age old theory that despite all talks of alternatives, the fossil fuel will continue to meet the bulk of global energy needs for decades and the Middle East will remain significant top energy supplier to the world. This conclusion concurs with the observations of the Opec too in this respect.

Mr Tanaka also underlined the need of an energy revolution as imminent, terming climate change and energy issues as two sides of the same coin. Huge investments are required in all the sectors of energy chain and controlling climatic changes is a major challenge with tremendous cost ramifications, he pointed out.

“Carbon capture and storage facilities need huge investments too,” he added.

In order to minimise the global usage and consumption of energy, the IEA has already finalised and submitted 16 recommendations to the Organisation for Economic Cooperation and Development, so as to ensure continuity and stability of this energy propelled civilisation of ours.