Abstract: In the process of reservoir numerical simulation, the permeability, oil saturation, porosity and other important physical parameters are derived from the geological mode. The accuracy of these parameters is particularly important for making various development programs, among which the permeability has the anisotropic characteristic, while the permeability can be only derived from the model in one dimensional. The accuracy is greatly reduced by determining permeability values in three dimensions according to the empirical assignment. The Ward method clustering analysis method will be first introduced into reservoir numerical simulation, and then the permeability data can be obtained by spatial geometry processing, which greatly improves the accuracy of numerical simulation. This method has been applied well in production examples, which provides a strong basis for the formulation of efficient development program of oilfield.