Saudi Aramco bullish on China oil demand: Nasser

Strong oil demand in China is mainly driven by growth in chemical needs, especially for the transition, electric vehicles (EVs), and solar panels, Nasser said on the sidelines of the Singapore International Energy Week conference.

"We see more demand for jet fuel and naphtha, especially for crude-to-chemical projects," he noted. “If so, more than 100 million barrels per day would realistically still be required by 2050.”

Developing countries, according to Nasser, are expected to see robust growth in oil demand for a long time as economies expand and living standards rise. Then, demand will likely settle despite the energy transition.

The CEO added that this is a stark contrast with those predicting that oil will, or must, fall to just 25 million barrels per day (bpd) by then. Being short 75 million bpd would be devastating for energy security and affordability.

Rather than displacing demand for conventional energy, alternatives are mostly meeting consumption growth, he said.

Countries should choose an energy mix that helps them meet their climate ambitions at a speed and manner that is right for them, the CEO said. “Our main focus should be on the levers available now.”

This includes encouraging investments in oil and gas that developing nations need and can afford and prioritizing the reduction of carbon emissions associated with conventional sources by improving energy efficiency and developing carbon capture, utilization, and storage (CCUS).

The shift to EVs in Asia, Africa, and Latin America is lagging behind that of China, the US, and the European Union as consumers struggle with affordability and infrastructure concerns.

The progress of EVs has no bearing on the other 75% of global oil demand, Nasser said, as massive segments such as heavy transportation and petrochemicals have few economically viable alternatives to oil and gas.

Despite trillions of dollars being invested in the global energy transition, oil and coal demand are at all-time highs, dealing a “hammer blow” to energy transition plans, Nasser said.