The Problem With Oil Lies

In the long, tortured history of oil forecasting, no institution has done more to burn its own credibility while doubling down on the same mistakes than the International Energy Agency. 

If the IEA had been around in 1912, it would have issued a report declaring horses a growth industry and war an unlikely disruptor to the coal trade. 

We’re talking about the same agency that, for the better part of two decades, has assured us that a global peak in oil demand was just around the corner — a forecast they’ve pushed forward like a busted clock that refuses to be right. 

Every year, the same song… 

Demand will peak by 2030. Fossil fuels are on their way out. Wind and solar will dominate global energy supply and save us all with absurdly aggressive net zero ambitions. 

And every year, the real world politely declines to cooperate. But the really astonishing part in all this isn’t that they keep getting it wrong — it’s that anyone still listens.

The IEA has become the oracle of optimism for a political class addicted to climate virtue signaling. 

Its forecasts aren’t designed to reflect reality so much as to manufacture consent for energy policies that make the public feel good — right up until the moment they freeze in the dark. 

Remember Europe’s energy crisis just a couple of years ago? That was the IEA’s handiwork in action. 

Western Europe, led by Germany, followed the IEA’s script to the letter: shut down coal, scrap nuclear, build wind farms, and pray Vladimir Putin delivers the gas on time. So, imagine our shock when the Russia-Ukraine war blew a hole through that delusion, and Germany had to desperately turn to U.S. LNG to keep the lights on. 

And yet, even then, the IEA never blinked. The forecast remained: a global peak in oil demand by 2030, and decline ever after.

Finally, the cracks are too big to plaster over. 

Soon, the IEA will walk back its central claim — that fossil fuel demand will begin falling within the decade. 

When those whispers become reality and the IEA releases its next World Energy Outlook, they’ll admit what the rest of us have known for years: demand is not peaking, there are still decades of growth ahead. 

The IEA has already come out and said they’ve been dead wrong about global oil demand growth. The agency has been forced to increase its oil demand forecast for 2025 to 740,000 barrels per day. 

At the same time, they’re projecting — with a straight face, mind you — that global oil supply will jump by 2.7 million barrels per day next year and another 2.1 million in 2026. 

The house of cards they’ve built — underestimating demand, overestimating supply — is wobbling. And when it falls, it’s going to crush the illusions that global energy markets have built around it.

Look, we’ve seen this movie before. 

Back in 2023, when the IEA issued its net-zero roadmap and insisted that oil, gas, and coal demand would all peak by 2030, markets took the bait. 

Oil prices crashed, not because of supply or demand fundamentals, but because sentiment — that fragile ghost — was hammered by the perception that the future was suddenly green and gasoline-free. Capital fled exploration and production. Politicians declared victory over hydrocarbons. ESG committees toasted to the demise of the internal combustion engine. 

But the truth was that consumption kept rising… and rising. 

Non-OECD countries like India didn’t get the memo that oil and gas had a dead future ahead. And the world, still stubbornly dependent on crude oil, kept pulling barrels out of the ground.

All the while, the IEA stuck to the script. It’s no longer just a forecasting problem — it’s a narrative addiction. 

The IEA exists in a feedback loop of its own making, where optimistic projections beget policy changes that in turn are used to justify more optimistic projections. It’s the bureaucratic equivalent of writing your weight goal in your diary and then marking it “achieved” because you bought a gym membership. 

The problem is, the real world still demands energy, and supply isn’t keeping up. But the damage has been done, hasn’t it? OPEC has officially regained control of the chessboard, and the so-called “non-OPEC supply surge” that the IEA keeps leaning on like a crutch is looking increasingly imaginary.

And nowhere is this disconnect clearer than in the IEA’s latest forecast. 

While raising demand expectations, they’ve also upped their supply growth projections — not because of actual production data, but because otherwise, their narrative falls apart. They NEED those extra barrels to appear, like a magician’s rabbit, just to hold together the illusion that everything is under control. 

Yet in the real world, oil majors are scaling back. Chevron, Exxon, Shell — the giants — are cutting capital expenditures and laying off workers. 

If oil at $60 a barrel was really enough to unleash a flood of new supply, we’d be seeing rigs pop up like spring weeds. Instead, we’re seeing consolidation, layoffs, and capital spending drying up.

In fact, the only reason U.S. oil output hasn’t collapsed altogether is because of the relentless march of technology and the gritty success from independent drillers. 

You know just as well as I do that the shale patch has been forced to get leaner, faster, smarter. Today, the best operators in the Permian can do more with half the rigs than they could with twice as many just a few years ago. 

Horizontal drilling, multi-well pads, advanced completions — this is where the innovation is happening. This boom isn’t taking place on notepads in Paris conference rooms, or on IEA spreadsheets, and certainly not in the policy chambers that bet the house on windmills and got blackouts in return.

Still, oil remains stubbornly cheap. With WTI crude barely holding in the low $60s, you’d think the world had discovered a replacement for hydrocarbons. 

Sadly, it hasn’t… not yet, at least. 

What it has discovered is a delay in panic, led by the soothing forecasts out of the IEA that act like a sedative for markets — just enough to keep investors numb to the coming supply crunch. 

Soon, they’ll have to finally admit — quietly, reluctantly — that demand is going up, not down. But instead of recalibrating with humility, they’re doubling down on optimistic supply projections to keep the illusion alive a little longer.

All this, mind you, when the geopolitical temperature is rising again. 

Russian drones shot down over Poland this week… that’s not just a headline — that’s a NATO red line. Just picture what direction crude would surge if the war in Ukraine spills across borders in earnest; oil traders would lose what little composure they have left. 

So what happens next? 

Here’s the rub: the only viable answer to this mess — the only lifeboat in this sinking ship of broken forecasts — is the U.S. oil patch. And not everywhere, unfortunately, because nearly all the growth we’ve seen over the last few years has been out of just one place — the Permian Basin. 

But real relief won’t come from the oil majors, those bloated and slow-moving crude behemoths that open up their pocketbooks every couple of years and radically overpay to be located in the best spots. 

Your Exxons, Chevrons… they don’t grow through the drillbit, dear reader. 

No, they BUY the drillbit. As well as the acreage, crews, and technology that comes with it. You see, that’s the dirty little secret in the U.S. oil industry that blows over Wall Streets’ head. The real winners are the U.S. operators with the expertise and new techniques that revolutionize U.S. oil output. 

Prior to the shale boom, you’d be hard pressed to find anyone outside of the industry that knew that the combination of horizontal drilling technology and hydraulic fracturing would forever change U.S. energy production. 

Today it’s common knowledge… and STILL misunderstood by some. 

You see, it’s not Big Oil that demands investors’ respect and attention. Rather, it’s the independents, the specialists, and the ones who’ve been refining their operations like a blade on a whetstone, quietly becoming the most efficient producers on earth. 

These are the oil players that’ll be heavily targeted when Big Oil wakes up to the fact that it can’t drill its way out of the hole — and make no mistake, they HAVE to buy their way out. M&A activity will ramp, valuations will spike, and investors who understood the lie early — who saw the IEA’s fantasy for what it was — will be in prime position to profit from the return of energy realism.

Because in the end, energy doesn’t care about press releases. Nor does it care to bend to political will or spreadsheet wizardry. You can’t build your oil lies on a house of cards like the IEA has and things come out great, especially when they’re forced to go back and revise their numbers with a giant, “Oops!”

The IEA can go back and rewrite history as many times as it wants, but it can’t revise geology, and it certainly can’t conjure rigs out of thin air when the supply/demand fundamentals tighten. 

The time for illusions is over, but is the market finally waking up?

Maybe. 

Just remember that when it does, it’ll be those quiet little drillers in the Permian nobody will be able to ignore.

P.S. Trump just launched a $500 billion nuclear revival to power America’s AI defense grid — and one tiny $10 company holds the only fuel approved for his next-gen reactors. With federal contracts already in motion and another deal imminent, this stock could surge 65x once Wall Street catches on.