The International Energy Agency (IEA) says Chinese and Indian crude oil imports will almost quadruple by 2030, creating a supply "crunch" as soon as 2015.

The IEA says China will replace the U.S. as the world's largest energy user early next decade and its oil demand will more than double to 16.5 million barrels a day by 2030, led by a sevenfold increase in Chinese car ownership.

China and India together account for almost half of a projected 55% increase in world energy demand, the IEA said in its World Energy Outlook.

Oil investments of US$5.3 trillion will be needed to counteract declining production from older wells, according to the IEA. If investments aren't made, this year's 61% surge in crude prices to more than $98 a barrel may be the start.

"From 2012, oil supply will be tight, this is not good news for anybody who wants to see an ease in prices," IEA Chief Economist Fatih Birol told Bloomberg in London. "The message to our governments is to slow down the demand increases and to producers to invest more if we want to avoid a supply crunch."

China and India's combined imports will surge to 19.1 million barrels of oil a day by 2030, from 5.4 million barrels of oil a day in 2006, the report said in its so-called "reference scenario." That's more than today's combined oil imports to Japan and the U.S., the largest energy user.

The IEA maintained projections for oil production reaching as much as 116 million barrels of oil a day by 2030, up from about 85 million barrels a day now. Demand would reach 120 million barrels a day and crude prices as high as US$159 a barrel in a "high growth scenario," Birol said.

"We have to look at this because we have all been wrong so far" about Chinese and Indian economic growth, said Birol. "The most important question is what is the pace of growth in China and India in years to come."

Bloomberg reports that some in the industry (including Fat Prophets) doubt that world production can meet IEA projections. Reaching 100 million barrels a day may be ``optimistic,'' Total SA Chief Executive Officer Christophe de Margerie and the chairman of Libya's state oil company, Shokri Ghanem, said recently.

"We are saying what needed to be done, not what will be done," said Birol, who added the investment decisions will largely be up to OPEC nations. "If they put their money there they can meet demand."

An average field decline of 3.7% a year means 12.5 million barrels of new production -- more than the current output of Saudi Arabia -- needs to be added between 2012 and 2015 to counter the drop and meet new demand, according to the IEA.

Even a slight increase in the rate of decline would "eat up most of the world's current spare oil production capacity," the group said. "Any shortfall in net capacity growth could result in a sharp escalation of prices."

For every US$4 invested in oil infrastructure, US$3 will be needed to slow declining rates in existing fields, while US$1 will go to new production, Birol said.

Russia and OPEC, home to as much as 82% of oil reserves according to statistics from BP Plc, should account for a larger share of production, though they may withhold investment because they realize higher prices will result, the IEA said.

OPEC's share of world oil production will rise to 52% by 2030 from the current 42%, the IEA said. So-called non-conventional oil sources, such as extra heavy oils, tar sands and natural gas-to-liquids sources, will quadruple to 8.5 million barrels of oil a day from 1.8 million barrels of oil a day in 2006, according to the IEA.

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