October 04, 2022 09:49 GMT
Saudi Aramco warn that spare capacity is running low with the risk to supplies when China demand starts to recover.
- “The world should be worried,” according to Saudi Aramco’s CEO Amin Nasser. “If China opens up a little bit you will find out that spare capacity will be eroded completely.”
- He said the oil market is focusing on short-term rather than long-term economics and is not focusing on tight supply fundamentals. They argue the surge in oil and gas prices this year is evidence that more exploration projects are needed.
- Spare capacity is only around 1.5% of total supply and it would take 30 days for Saudi Arabi to reach their current maximum capacity of 12mbpd.
- Nasser said Aramco was on track to increase its capacity to 13mbpd by 2027 and is confident it can maintain its market share in Asia, where they send 60% of crude exports.