Aramco CEO on potential production hikes, global oil demand growth: Key takeaways

RIYADH: After reporting its highest quarterly profit since the company went public in 2019, primarily boosted by higher oil prices and refining margins, Saudi Aramco CEO Amin Nasser met the press and shared his optimistic outlook on oil demand but remained worried about the lack of investment in the sector. 

Below are the key takeaways from the discussion with the CEO:

Oil demand growth

• Oil demand growth is healthy with more demand coming from Asia. 

• Aramco is deeply concerned with the lack of investment in oil output capacity globally.

• There could be an additional 2 million barrels per day crude oil demand next year, but not sufficient capacity to meet that demand.

• The oil market could further tighten if demand for aviation fuel rises.

Production hike

• Aramco is ready to increase oil production to 12 million bpd if the government asks for it. 

• Output capacity will be increased significantly from 2025, and it will reach 15 million bpd by 2027. 

Widening the horizons

• Aramco is in talks with China’s Sinopec and others on petrochemicals and liquid-to-chemicals projects.

• Aramco plans to enhance cooperation with Chinese entities working within the Kingdom. 

• The growth of Saudi Aramco in Europe is not as good as in Asia, but still, the firm is looking for more opportunities there.

• The potential joint venture with PKN Orlen, along with the existing tri-party agreement between Aramco, SABIC, and PKN Orlen could be the next big thing for Aramco in Europe.

Sustainability and reliability

• Aramco has the lowest carbon intensity globally, as it steadily continues its journey to achieve sustainability. 
• The oil giant has 99.8 percent reliability in delivering crude to its customers. 

• Aramco has strong contingency plans. 

Ongoing projects

• The Jafurah gas project’s first phase will become operational by 2025, followed by the opening of its second phase in 2027. 

In the second quarter of 2022, Aramco’s profit surged 90 percent to hit SR182 billion ($48.4 billion), while the revenue soared 80 percent to SR562 billion.