The global oil demand will realistically surpass 100 million barrels per day by 2050, according to Saudi Aramco’s President and CEO, Eng. Amin bin Hassan Al-Nasser. Speaking at the International Energy Week conference in Singapore, Amin Al-Nasser remarked that Asia’s energy transition strategy is progressing much more slowly, with less equity and greater complexity than many had anticipated. He emphasized the need for a recalibration of policies for developing countries.
Al-Nasser further stated that, despite the ongoing transition, the Global South is expected to experience significant growth in oil demand for an extended period, particularly as economies expand and living standards rise. Although this growth will eventually plateau, a sustained period of stability is likely to follow.
The complex energy transition in Asia
The Saudi Aramco President and CEO explained that, under this scenario, demand for more than 100 million barrels per day will remain realistic by 2050. He contrasted this outlook with those who predict that oil demand will decline to merely 25 million barrels per day by that time, highlighting that such a shortfall of 75 million barrels per day would pose serious risks to energy security and affordability.
Sustained growth in oil demand
Al-Nasser urged nations to adopt an energy mix that aligns with their climate ambitions in a timely and appropriate manner, emphasizing the importance of focusing on available solutions. This approach includes promoting investments in the oil and gas sectors that are essential and feasible for developing countries, along with prioritizing the reduction of carbon emissions from traditional energy sources through enhanced energy efficiency and the advancement of carbon capture, utilization, and storage technologies.
Aligning energy mix with climate goals
Furthermore, Al-Nasser pointed out that, despite the investment of trillions of dollars in the global energy transition, demand for oil and coal remains at unprecedented levels, which significantly undermines transition efforts. Nasser noted that Asia, which consumes over half of the world’s energy supplies, continues to depend on traditional resources for 84 percent of its energy needs. Rather than replacing traditional energy demand, alternative sources predominantly serve to accommodate increasing consumption.
He observed that the shift toward electric vehicles in Asia, Africa, and Latin America is lagging behind the advancements made in China, the United States, and the European Union, where consumers face challenges related to affordability and infrastructure.
Ongoing dependence on traditional energy
Al-Nasser added that progress in electric vehicle adoption does not significantly affect the remaining 75 percent of global oil demand, as substantial sectors such as heavy transport and petrochemicals have limited economically viable alternatives to oil and gas.
He indicated that developing countries may require nearly $6 trillion annually to finance their energy transitions and advocated for a greater role for these nations in climate policy-making.
Moreover, Al-Nasser conveyed that Aramco remains cautiously optimistic about oil demand in China, particularly in light of government stimulus packages designed to bolster economic growth.
Advocating for a comprehensive transition plan
During the event, Al-Nasser advocated for a “Transition Plan 2.0,” an improved framework for energy transition that addresses the limitations of the current strategy. He stressed that this new plan must consider the diverse needs of all nations, particularly those in Asia and the Global South.
Read more: Excess production capacity not solely Saudi’s responsibility, Aramco chief says
Recognizing Asia’s role in global energy
Al-Nasser emphasized the necessity of establishing a new energy transition framework that acknowledges Asia’s critical role in the global arena, the nature of its available resources, and its potential for future growth.
He remarked on the significance of a revised transition strategy, suggesting that this could be Asia’s century. However, he pointed out that the voices and priorities of Asia and the wider Global South are often neglected in existing transition plans, which affects the entire world. He expressed concern that the pace of the transition is slower, less equitable, and more complex than expected, stressing the importance of focusing on actionable solutions rather than purely theoretical approaches.
Emission reductions and multi-dimensional strategies
Additionally, Al-Nasser underscored the need for systematic emission reductions to achieve meaningful results at a reasonable cost and within a practical timeframe. Al-Nasser noted that the strategy should be multi-source, multi-speed, and multi-dimensional, avoiding favoritism toward any specific type of energy or technology.
Financial challenges of transitioning energy systems
Addressing the financial challenges associated with the energy transition, Al-Nasser explained that the transition will entail substantial costs for all parties, with global estimates ranging from $100 to $200 trillion by 2050. He highlighted that developing countries may require nearly $6 trillion annually. Moreover, he pointed out that in a transition demanding significant initial capital investment, the cost of capital is more than double in developing nations, where the need is most acute.
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