Aramco: gas crisis increases demand for oil by 500,000 bpd

The natural gas crisis has increased global demand for oil by 500,000 bpd, Saudi Aramco chief executive told this week’s Energy Intelligence Forum.

“The demand is higher,” Nasser said, while cited by Bloomberg. “We have seen some shift from gas to liquids, particularly in some Asian markets.”

Energy intelligence cited the executive said he expected demand for oil to reach 99 million bpd by the end of this year and continue to rise to 100 million bpd in 2022. This appears to have bolstered the Aramco’s determination to increase its maximum sustained production capacity to 13 million bpd.

“Our maximum sustained capacity of 12 to 13 million bpd … will not reach full capacity at 13 million bpd until 2027,” Nasser said, however, as cited by Reuters.

Aramco also intends to grow its oil trading business from the current 5.5 million bpd to 8 million bpd in five years, Nasser said.

Brent crude jumped to over $ 81 a barrel yesterday after OPEC + said it would not add more barrels to its monthly production on top of the 400,000 bpd already agreed earlier this year. Without being surprising, the cartel’s decision went against certain expectations, or rather hopes, that it will intervene to offset the strong rebound in demand for oil while supply remains generally tight.

Goldman Sachs recently updated its fourth quarter oil price forecast, now expecting Brent to hit $ 90 a barrel amid the energy crisis. Bank of America went further, warning that crude could reach $ 100 a barrel by the end of the year due to the energy crisis if the winter in the northern hemisphere turns out to be extremely cold.

BofA is bullish on oil not only in the short term, but also in the longer term, due to the chronic underinvestment in new supplies, driven by last year’s crisis and the net zero liabilities of energy companies and consumers. governments.

By Charles Kennedy for Oil chauffage

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Felix J. Dixon