Aramco, the state-owned oil company of Saudi Arabia, is optimistic about the oil market for the remainder of 2023 because demand from the two largest importers, China and India, is anticipated to be high despite an anticipated worldwide slump.
“We believe that oil market fundamentals remain generally sound for the rest of the year,” CEO Amin Nasser said at the Energy Asia conference in the Malaysian capital, Kuala Lumpur.
His upbeat outlook comes despite China's apparent slowdown in economic growth, which has led to repeated reductions in the nation's most important lending rates. China is the world's largest oil importer.
“Despite the recession risks in several OECD countries, the economies of developing countries, especially China and India, are driving oil demand growth of more than 2 million barrels per day this year,” said Nasser.
The supply-demand ratios in the sector would probably tighten once the general global economy begins to revive, he predicted.
“Although China is facing some economic headwinds, the transport and petrochemical sectors are still showing signs of demand growth,” the CEO added.
It confirms the International Energy Agency's forecast that global oil demand will climb by 2.4 million barrels per day in 2023, exceeding the 2.3 million barrel per day increase from the previous year. In their report from June, the agency mentioned that 60% of the increases come from China.
“Indian demand is equally robust with the latest readings for May showing both gasoline and diesel breaking records,” the agency said in their June report. Conversely, the demand from OECD countries “remains lackluster” amid an ongoing manufacturing slump and generally subdued economic growth.
The Aramco CEO also observed a lack of emphasis on issues related to energy affordability and security.
Given its reputation as a growing economic powerhouse and its rate of population increase, Asia needs an increasing amount of energy, but that route to success is "increasingly threatened by current transition policies," he said.
“Even at the tip of the transition sphere, the picture is hardly rosy,” Nasser said.
Despite their contributions over the previous ten years, Nasser claimed that they haven't been sufficient to keep up with the rise in world energy use.
He emphasised that the price of green hydrogen is still around $400 per barrel and contrasted it to the price of oil, which is roughly $75 per barrel.
“Demand for conventional energy like oil and gas has continued to increase, while coal remains the world’s largest source of electricity,” he said.
He brought up the fact that the current transition strategies have already resulted in a decade of underinvestment in oil and gas, a condition that will bring "energy chaos," according to the secretary general of OPEC, who had earlier spoken at the conference.
Tuesday morning in Asia, the price of the global benchmark Brent was up 0.46% to $74.52 per barrel, while the price of the U.S. West Texas Intermediate futures was up 0.55% to $69.75.
Before lessening reliance on the old energy, Nasser said that new energy must be ready.
“If you put all your transition eggs in the New Energy basket, you are scrambling when that basket cannot carry the load.”
(Source:www.economictimes.com)
“We believe that oil market fundamentals remain generally sound for the rest of the year,” CEO Amin Nasser said at the Energy Asia conference in the Malaysian capital, Kuala Lumpur.
His upbeat outlook comes despite China's apparent slowdown in economic growth, which has led to repeated reductions in the nation's most important lending rates. China is the world's largest oil importer.
“Despite the recession risks in several OECD countries, the economies of developing countries, especially China and India, are driving oil demand growth of more than 2 million barrels per day this year,” said Nasser.
The supply-demand ratios in the sector would probably tighten once the general global economy begins to revive, he predicted.
“Although China is facing some economic headwinds, the transport and petrochemical sectors are still showing signs of demand growth,” the CEO added.
It confirms the International Energy Agency's forecast that global oil demand will climb by 2.4 million barrels per day in 2023, exceeding the 2.3 million barrel per day increase from the previous year. In their report from June, the agency mentioned that 60% of the increases come from China.
“Indian demand is equally robust with the latest readings for May showing both gasoline and diesel breaking records,” the agency said in their June report. Conversely, the demand from OECD countries “remains lackluster” amid an ongoing manufacturing slump and generally subdued economic growth.
The Aramco CEO also observed a lack of emphasis on issues related to energy affordability and security.
Given its reputation as a growing economic powerhouse and its rate of population increase, Asia needs an increasing amount of energy, but that route to success is "increasingly threatened by current transition policies," he said.
“Even at the tip of the transition sphere, the picture is hardly rosy,” Nasser said.
Despite their contributions over the previous ten years, Nasser claimed that they haven't been sufficient to keep up with the rise in world energy use.
He emphasised that the price of green hydrogen is still around $400 per barrel and contrasted it to the price of oil, which is roughly $75 per barrel.
“Demand for conventional energy like oil and gas has continued to increase, while coal remains the world’s largest source of electricity,” he said.
He brought up the fact that the current transition strategies have already resulted in a decade of underinvestment in oil and gas, a condition that will bring "energy chaos," according to the secretary general of OPEC, who had earlier spoken at the conference.
Tuesday morning in Asia, the price of the global benchmark Brent was up 0.46% to $74.52 per barrel, while the price of the U.S. West Texas Intermediate futures was up 0.55% to $69.75.
Before lessening reliance on the old energy, Nasser said that new energy must be ready.
“If you put all your transition eggs in the New Energy basket, you are scrambling when that basket cannot carry the load.”
(Source:www.economictimes.com)