China's energy security is Saudi Aramco's "highest priority" and will remain so for the next 50 years and beyond, the company's CEO Amin Nasser has said during a speech he made at the China Development Forum on Sunday.
Saudi Aramco
Saudi Arabia is the largest exporter of oil in the world and it held its position as China's main supplier in the first two months of 2021, with volumes up 2.1% to a daily total of 1.86 million barrels, according to data released over the weekend by Chinese customs.
Despite the unprecedented cuts to production that were made in a push to stablise the global markets following the cliff-edge drop in demand during the Covid-19 pandemic, Saudi beat Russia and kept its position as China's number one crude supplier in 2020.
“Ensuring the continuing security of China’s energy needs remains our highest priority – not just for the next five years but for the next 50 and beyond,” said Nasser in a video speech.
“We appreciate that sustainable energy solutions are crucial to a faster and smoother global energy transition ... But, realistically, this will take some time since there are few alternatives to oil in many areas.”
During an earnings call made earlier in the day, Nasser said that Chinese demand was very close to the levels of before the pandemic and that Asia, especially East Asia, had seen a strong pickup.
The Aramco CEO said that, as well as being the top supplier for Chinese demand, his company was able to help China reach its energy transition targets.
Last September, Chinese President Xi Jinping announced that the country's carbon emissions would peak in 2030, but that China would be carbon neutral by 2060.
Xi's announcement is expected to create tectonic shifts in Chinese industry, especially the manufacturing and energy sectors.
The state-owned oil giant is anticipating further investment opportunities in downstream projects which can help China meet its rapidly burgeoning demand for heavy vehicles, as well as chemicals, lubricants and non-metallic materials, said Nasser.
He added that Aramco is partnering with universities and companies in China to develop cleaner fuel systems and technology to convert crude to chemicals and cut carbon emissions from existing energy sources.
“In fact, we have even bolder ambitions to expand and intensify our research collaboration with China,” said Nasser, adding that other collaborations are likely, such as blue hydrogen, ammonia and carbon capture tech.
Researchers at the China National Petroleum Corp’s (CNPC) institute forecast that, under Xi's climate pledge, China's demand for oil will peak in around 2025 at 730 million tonnes.
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