On day two of the Oil & Money conference in London, Christophe de Margerie, Total’s chief executive, dropped something of a bombshell when he said he saw predictions that world oil output could rise to 100m barrels per day as the "optimistic" case.

Given that the International Energy Agency, and other official bodies are predicting a rise to 115m b/d or more, that is a strikingly low number.

As with the IEA’s own concerns about production, the issue is not so much the geology of oil reserves - the "below ground" factors, as they are known - although they play a part in Mr de Margerie’s story. More important, however, are the "above ground" factors: the lack of capacity in the industry to develop resources sufficiently quickly, and the geo-political problems that have hit production in countries as diverse as Nigeria, Venezuela, and Iraq.

What that means for prices, Mr de Margerie wouldn’t say. Predicting oil prices is a mug’s game, and Mr de Margerie has been around too long to get involved in it. As Albert Helmig, president of Grey House, a consultancy, put it: "The only thing I can guarantee is that the price will be different tomorrow. [There is] a lot of noise, little fact."

That said, however, it is clear that Mr de Margerie’s view of supply potential implies that prices will oscillate around a much higher central point than in the past.

Peak oil - the prospect that global oil production is close to or even past its peak - turned out to be the dominant theme of the first day of the 2007 Oil & Money conference in London. With prices close to $90 a barrel - even though they fell sharply on Tuesday - the threat of oil shortages seems much more pressing than it did a year ago.

Plenty of speakers showed versions of a chart showing investment into upstream projects - finding and producing oil - soaring in the past five years, while total output remains almost flat. There was a lot of talk about the battle against the brutal logic of decline rates - the rate at which production declines from mature fields - and how today’s oil finds were smaller, more challenging to produce and generally of lower quality than the finds of past decades.

Shokri Ghanem, Libya’s oil minister and chairman of the National Oil Company, observed that he did not expect world oil production to get much higher than 100m barrels a day, plus or minus 5 per cent. That is well up on today’s 85m b/d or so, but a long way short of the 116m b/d that the International Energy Agency expects for 2030.

Mr Ghanem was responding to a question from David Strahan, a writer and TV producer who is the author of "The Last Oil Shock", a well-written exposition of the peak oil case.

On the other side of the argument, representatives of the industry including Andrew Gould of Schlumberger, the world’s biggest oil services company, and Thomas O’Malley, chief executive of Petroplus, who is a US oilman now running Europe’s biggest independent refiner, argued that higher prices would ultimately draw out more supplies.

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