Wed. Oct 4th, 2023
    Saudi Aramco CEO Maintains Bullish Outlook on Oil Demand Despite Reduced Forecasts

    Saudi Aramco CEO Amin Nasser has stated that despite his company’s reduced global oil consumption forecasts over the past decade, they still hold a more bullish outlook compared to many observers. While Aramco expected a projection of around 125 million barrels per day (bpd) by 2030 back in 2010, Nasser now believes that demand may rise to 110 million bpd by that time.

    Even with this revised forecast, Nasser’s outlook exceeds other prominent projections. The International Energy Agency (IEA), for example, predicts that oil demand may peak below 105 million bpd. Nasser criticized the IEA’s prediction, stating that it is unrealistic and based more on policies rather than market dynamics, competitive economics, and technological advancements.

    Nasser emphasized that the energy transition to alternative sources is not a “quick fix” and cautioned against phasing out fossil fuels too quickly. He argued that the continued usage of oil, with a record consumption of 103-104 million bpd expected for the second half of this year, makes any rapid transition dangerous.

    Nasser’s bullish near-term outlook is supported by recent projections from OPEC and the IEA. OPEC estimates a supply shortfall of over 3 million bpd in the next quarter, potentially the largest deficit in over a decade. The IEA projects a smaller but still significant shortfall of 1.2 million bpd in the second half of the year.

    Overall, while Aramco’s forecasts have been reduced, Nasser maintains a more optimistic perspective on future oil demand compared to others. The energy transition, according to him, requires a balanced and gradual approach rather than a rapid abandonment of fossil fuels.

    Sources: Bloomberg (self-reported)