Saudi Aramco sees ride-sharing as threat to oil demand: report

Saudi Aramco considers the growth of ride-sharing services like Uber a major disruptive factor for oil demand, rather than the rise of electric or autonomous cars, Financial Times reported, citing company officials. 

“I would argue that ride-sharing is a far more advanced trend than the other two,” Yasser Mufti, vice-president of corporate planning, told the newspaper.

While sales of electric vehicles will expand rapidly, Saudi Aramco said it thinks battery-powered and hybrid cars will account for a small part of the overall market for years to come and will reach 10-20 percent by 2040 only in the most optimistic scenarios.

“Electric vehicle [usage] will grow; we have no doubt it will grow… [But] we need to be realistic,” Amin Nasser, chief executive of Saudi Aramco, told the Financial Times.

According to estimates by the International Energy Agency, there will be 50 million electric vehicles on the road by 2025 and nearly 300 million by 2040, from an estimated 2 million now. This transformation will curb global oil demand by 2 percent over that period, the agency expects.

Despite the challenges, Saudi Aramco said it is hoping to benefit from “growing demand” for traditional fuel usage in developing countries where populations are expanding and becoming wealthier. 

“The middle classes will increase, and they will require more of the modern lifestyle. Energy requirements will also increase,” said Nasser.

Meanwhile, Mufti noted that “Saudi Aramco was very confident that there still is at least two decades of growth in oil in the entire transportation sector”.

“The whole thing is up for grabs,” he said.