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Saudi Aramco CEO: World’s oil consumption will not decrease by 2040

Edmund Heaphy
Finance and news reporter
  • D
    Darren
    germany still using coal till 2038 LOL, they just built a brand new coal plant last week.
  • S
    Sam
    Oil is not only used to produce petrol. It is also used to make plastic among other things.
  • J
    Jim
    (1) Saudi Arabia is trying to sell Aramco. This is problematic since oil demand is expected to flatten between 2025 and 2030 (by a previous Saudi Oil minister) and analysis confirms this expectation. Selling a sunset company this close to demand flattening when even more large oil field discoveries occur yearly adding to the oil glut with the added responsibility of having to control oil output to maintain world oil prices will be an enormous task. There doesn't seem to be a ton of buyers.

    (2) In the US, oil companies are selling assets while others are going bankrupt. Fracked oil requires $60 oil; fracked oil is 50% of US oil production. This is not a good sign for the oil business.
    (3) While oil companies are shifting into chemicals, that requires the oil companies to shrink their income expectations - these sidelines do not produce the behemoth revenue streams that they are used to.
    (4) Plastics represent only 10% of the oil demand pie so this product is not a lifeline.
    Crude oil shares the stage with natural gas as a the feedstock for plastics.
    (5) Car gas engine efficiency (70% of oil demand) is driving oil demand down.
    (6) Developed countries oil demand is falling; the rise in oil demand from developing countries will not replace the demand drop of the developed countries.
    (7) Natural gas is replacing coal in the power generation market; 90% of coal is destined for this market so power generation will not be a market for oil as electric vehicles increase power demand plus natural gas does not produce the revenue streams oil companies are used to.
    (8) Banks and investors are not finding oil a great investment for the future; in fact they are fleeing the oil market. There is just too much oil out there.
    (9) Fracked oil requires $60 oil; the market is having a tough time keeping above that price. Middle East oil production costs are $3 to $6 per barrel, offshore oil is in the $40+ range.
    (10) there is too much oil on the sidelines that can come in at any time. Iran and Venezuela have been sanctioned off the market; with proper management, Venezuela production could be increased (their reserves are larger than Saudi reserves). Syria is out of the market due to war. Iraq is under control of Shell(US) and BP(UK). Libyan oil is offline due to politics right now. The oil price is controlled not market driven; if oil production is allowed to be free-market driven the market price of oil could easily hit $35. If oil hit that market price then much of the oil out there will be out of the market place - fracked oil, offshore oil. That is a scary investment bet - will oil remain a price-controlled environment or a free-market controlled environment.
  • A
    Allan
    Asking an oil tycon to buy oil is like asking a banker if you should get a loan.
  • N
    NORBERT
    What did you EXPECT him to say, that it would go down?
  • h
    hoglegjack
    all these geniuses need to come up with non oil based plastics
  • m
    mario
    It wont with the same type of leaders in power that r all invested in oil, even though with today's technology we really dont need it as we once did
  • E
    Eddie Willers
    Of course oil consumption will not decrease. The world, especially the developing world needs a cheap, accessible, reliable power source.........Hmmm what could it be that means all those needs? Solar.......NOPE.............Wind.............NOPE.............hydroelectric..........NOPE.............here's the answer.....Fossil Fuels.........Sorry Greta, hopefully by 2040 you will have rebelled against your captors, escaped their grasp, and wised up.
  • b
    b h
    And Im trying to save my and my country's #$%$ because we've been screwing the rest of the world over for decades with "affordable" energy prices. What a crock of #$%$ Oil consumption will decrease 20-25% by 2040 because:1. Engineered oil consumption efficiencies2. Solar: Buildings/ Residences etc will have solar roofs as the price of solar drops and this virtually "free" energy source will provide more and more energy to households eliminating the need for oil and other fossil fuels.3. Solar: Eventually a battery solar powered car will become the norm. Right now they battery technology is not there. but in a generation is should be.4. Wind- It will only be a matter of time where municipalities get into the wind farming (those that can and have the space) and sell power to their own citizens.5. The Anti fossil fuel movement: its not going to let up until we either freeze to death or figure out how to live without it. Its ridiculous but pushed engineering to figure out and solve a societal issue.
  • k
    kevin
    oil is king, and will continue to be for the rest of this century.