Oil & Gas Aramco predicts oil market expansion on China demand By Andrew Hammond October 30, 2024, 8:07 AM Reuters/Hamad I Mohammed Saudi Aramco president and CEO Amin Nasser speaks at the Future Investment Initiative in Riyadh Aramco CEO cites China ‘upside’ Market growth of 1.5% forecast Energy transition needs plastics Saudi Aramco is forecasting oil market growth in 2025 of 1.5 percent, driven by fundamental growth in China and the role of fossil fuels in underpinning the green energy transition. A recent stimulus package failed to alleviate market concerns about China. Although it accounted for 70 percent of oil demand growth in 2023, Chinese demand has been slower than expected this year. “The market is currently balanced today,” Aramco president and CEO Amin Nasser told the Future Investment Initiative summit in Riyadh. “We are looking at 104.5 million barrels average for this year, and in the fourth quarter we’re looking at 106 million barrels. Gas is also increasing. So next year we’re anticipating growth of about 1.5 percent.” Nasser also pointed to growth in Chinese petrochemical demand as well as oil and gas, which was partly driven by the shift to renewables in the world’s second largest economy. “China is increasing naphtha (oil) and LPG (liquefied petroleum gas),” he said. “In jet fuel there is a small impact on gasoline because of the build-up in electric vehicles and the economic situation, but in general there is still growth in China. “When people talk about China they are always trying to maximise the downside and ignore the upside.” Nasser repeated his message in other global forums that the Global South is likely to remain dependent on conventional sources of energy. “For 5MW of wind-generated power you need 50 tonnes of plastics. For every electric vehicle you need 200-230kg of plastic. Even in solar panels, 10 percent comes from fibre and so on. So for the transition to happen you need more oil,” he said. Finance leaders, tech entrepreneurs and politicians are meeting this week at the FII summit in the shadow of the Iran-Israel conflict and war in Gaza and Lebanon, and a US election on November 5 that could return former president Donald Trump to power. Aramco cancels Saudi project amid Asia focus Saudi petchem profits could rise but margin pressures persist Gulf spots opening in China’s polysilicon boom-bust cycle Saudi Arabia, the leading oil exporter in Opec+, is pitching itself as a global player in green energy and artificial intelligence industries. Nasser said Aramco was pushing ahead with carbon capture projects to help reach global net zero targets by 2050.
