Major new investment in energy takes 10-15 years from the initial investment to first production, and to date we have not seen the amount of new projects that would supply the projected increase in demand.'Īnd while the world is gradually moving to new kinds of clean energy technologies the insurance market warns that there could be shortages of earth metals and other raw materials needed to help them thrive. 'Even before we reach peak oil,' says the Lloyd's report, 'we could witness an oil supply crunch because of increased Asian demand.

It also quotes from a US department of energy report highlighting the economic chaos that would result from declining oil production as global demand continued to rise, recommending a crash programme to overhaul the transport system. It repeats warning from Professor Paul Stevens, a former economist from Dundee University, at an earlier Chatham House conference that lack of oil by 2013 could force the price of crude above $200 (£130) a barrel. The report the world is heading for a global oil supply crunch and high prices owing to insufficient investment in oil production plus a rebound in global demand following recession. It takes a pot shot at the International Energy Agency which has been under fire for apparently under-estimating the threats, noting: 'IEA expectations over the last decade have generally gone unmet.' The review is groundbreaking because it comes from the heart of the City and contains the kind of dire warnings that are more associated with environmental groups or others accused by critics of resorting to hype. The insurance market has a major interest in preparedness to counter climate change because of the fear of rising insurance claims related to property damage and business disruption. Failure to do so could lead to expensive and potentially catastrophic consequences,' says the Lloyd's and Chatham House report 'Sustainable energy security: strategic risks and opportunities for business'. 'Companies which are able to take advantage of this new energy reality will increase both their resilience and competitiveness.

London is declining as global city