News / Middle East

Demand for Saudi Oil to Grow in Coming Months

Saudi Arabian Oil Minister Ali Al-Naimi (L) attends the First Gulf Cooperation Council Petroleum Media Forum in Kuwait City, March 25, 2013.Saudi Arabian Oil Minister Ali Al-Naimi (L) attends the First Gulf Cooperation Council Petroleum Media Forum in Kuwait City, March 25, 2013.
x
Saudi Arabian Oil Minister Ali Al-Naimi (L) attends the First Gulf Cooperation Council Petroleum Media Forum in Kuwait City, March 25, 2013.
Saudi Arabian Oil Minister Ali Al-Naimi (L) attends the First Gulf Cooperation Council Petroleum Media Forum in Kuwait City, March 25, 2013.
Reuters
— Demand for Saudi crude is likely to rise over the next few months, Saudi oil minister Ali Al-Naimi said on Monday, in a sign that the world's largest oil exporter sees a recovery in its biggest export market, Asia.

State-run Saudi Aramco cut production sharply in the fourth quarter of last year because of weak economic growth abroad and lower seasonal demand for oil for power generation at home.

It kept oil output steady at around 9.05-9.15 million barrels per day [bpd] in January and February, but industry sources have said exports could rise in the second quarter, driven by Asian demand.

Naimi confirmed on the sidelines of an industry event in Doha on Monday that he expected external demand for Saudi crude to rise over coming months, but said it remained to be seen by how much.

China's factory activity rebounded in March in a sign that its underlying economic recovery is strong enough to weather any uneven export periods, surveys showed on Monday.

China imported 1.08 million barrels a day of crude from Saudi Arabia in 2012, up 7.24 percent from 2011, and state-run CNPC expects China's total net imports to rise again in 2013.

Saudi Arabia, OPEC's leading producer and holder of the world's only significant spare capacity, slashed its output by around 700,000 bpd over the last two months of 2012, helping drive a rise in crude prices from early December to February.

Long-term outlook

With Europe wallowing in debt and the United States consuming more of its own oil, demand from Asia has become the main driver of oil exports from producers in the Gulf Cooperation Council [GCC] over the last decade.

Asia collectively bought more than three times as much Saudi crude in 2011 as buyers in North America, and five times more than Europe, according to Saudi government data.

Rapid population growth in Asia, and a booming middle class in China in particular, is likely to see ever more Saudi crude head east as European and U.S. oil import demand wanes.

"For decades, GCC energy supplies helped support economic growth in the U.S. and across Europe... We have done the same in Asia, supplying energy to help fuel its increasing growth and prosperity," Naimi told the Brookings Doha Center.

"It is thanks to Asian demand and GCC energy supplies that our region's combined GDP is at an historic high - and that economic growth remains strong," he said, pointing to population growth as a firm driver for future demand.

OPEC oil producers have played down the potential threat of a surge in North American shale oil production over the last few years, arguing that more supplies are good for price stability.

"I, for one, welcome all new energy sources to the market. I don't think anyone should fear new supplies when set against increasing global demand," Naimi said, according to a copy of his speech in Doha sent to the media.

"More companies and nations are competing for their slice of the energy pie. That's true. But the pie is getting bigger and there is enough to go around."

You May Like

Lebanese Media Unite to Support Palestinians in Gaza

Joint newscast billed as Arab world’s first unified news bulletin in support of Hamas-controlled Gaza Strip More

Photogallery Australian PM Alleges ‘Coverup’ at MH17 Crash Site

Meanwhile, Russia's ambassador to Malaysia denies plane's black boxes were opened before they were handed over to Malaysian officials More

Despite Advances in AIDS Treatment, Stigma Lingers

Leading immunologist tells VOA that stigma is often what prevents those infected with disease from seeking treatment More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
IAEA: Iran Turns its Enriched Uranium Into Less Harmful Formi
X
July 22, 2014 10:26 AM
Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video IAEA: Iran Turns its Enriched Uranium Into Less Harmful Form

Iran has converted its stockpiles of enriched uranium into a less dangerous form that is more difficult to use for nuclear weapons, according to the United Nations’ Atomic Energy Agency. The move complies with an interim deal reached with Western powers on Iran's nuclear program last year, in exchange for easing of sanctions. Henry Ridgwell reports for VOA from London.
Video

Video Relic of Saint Draws Catholics Worried About Immigration Issue

A Roman Catholic saint who is a figure of devotion for those crossing the border into the United States is attracting believers concerned about the plight of undocumented immigrants. Mike O'Sullivan reports from Los Angeles, where a relic of Saint Toribio has drawn thousands to local churches.
Video

Video Ukraine Rebels Surrender MH17 Black Boxes

After days of negotiations, a senior separatist leader handed over two black boxes from an airliner downed over eastern Ukraine to Malaysian experts early Tuesday. While on Monday, the U.N. Security Council unanimously demanded that armed groups controlling the crash site allow safe and unrestricted access to the wreckage.
Video

Video In Cambodia, HIV Diagnosis Brings Deadly Shame

Although HIV/AIDS is now a treatable condition, a positive diagnosis is still a life altering experience. In Cambodia, people living with HIV are often disowned by friends, family and the community. This humiliation can be unbearable. We bring you one Cambodian woman’s struggle to overcome a life tragedy and her own HIV positive diagnosis.
Video

Video Nature of Space Exploration Enters New Age

Forty-five years ago this month, the first humans walked on the moon. It was during an era of the space race between the United States and the Soviet Union. World politics have changed since then and -- as Elizabeth Lee reports -- so has the nature of space exploration.
Video

Video Chicago’s Argonne Lab Developing Battery of the Future

In 2012, the U.S. Department of Energy’s Office of Science awarded a $120 million grant to a new technology center focused on battery development - headquartered at Argonne National Laboratory in suburban Chicago, Illinois. As VOA’s Kane Farabaugh reports, there scientists are making the next technological breakthroughs in energy storage.
Video

Video In NW Pakistan, Army Offensive Causes Massive Number of Displaced

Pakistan’s army offensive in North Waziristan has resulted in the large-scale displacement of the local population. VOA's Ayaz Gul reports from northwest Pakistan where authorities say around 80 percent of the estimated 1 million internally displaced persons [IDPs] have settled in Bannu district, while much of the remaining 20 percent are scattered in nearby cities.
Video

Video Kurdish Peshmerga Force Secures Kirkuk, Its Oil

The Kurdistan regional government has sent its Peshmerga troops into the adjacent province of Kirkuk to drive out insurgents, and to secure the area's rich oil fields. By doing this, the regional government has added a fourth province to the three it officially controls. The oil also provides revenue that could make an independent Kurdistan economically strong. VOA’s Jeffrey Young went out with the Peshmerga and filed this report.
Video

Video Malaysia Reeling: Second Air Disaster in Four Months

Malaysia is reeling from the second air disaster in four months involving the country’s flag carrier. Flight 340 vanished in March and despite an extensive search, no debris has been found. And on Thursday, Flight 17, likely hit by a surface-to-air missile, came apart over eastern Ukraine. The two incidents together have left more than 500 people dead. VOA Correspondent Steve Herman reports from Kuala Lumpur.

AppleAndroid