Saudi Aramco CEO says world should abandon 'fantasy' of phasing out oil

https://www.cnbc.com/2024/03/18/saudi-aramco-ceo-says-energy-transition-is-failing-give-up-fantasy-of-phasing-out-oil.html

by belter • 2 years ago

42 38 2 years ago

cnbc.com

SimbaOnSteroids• 2 years ago

Breaking: Fent dealer says sobriety unrealistic.

autoexecbat• 2 years ago

I'm glad this was said, now I can finally ditch my EV

lenerdenator• 2 years ago

We're not going to _completely_ phase it out - it's too useful for a number of products - but we could absolutely reduce our use of it, and if he thinks the line is going to continue to go up, he's probably wrong.

boringg• 2 years ago

Agree with this. These CEOs try and use the line that your not going to get rid of oil completely to get people rilled up. Noone is expecting that - though the thought is to significantly lower our reliance on it through new technology adoption.

asdff3• 2 years ago

He's not wrong, everything is plastic packaged in more plastic. So far industry has been totally unwilling to change that en masse. Often doubling down in fact.

toomuchtodo• 2 years ago

Saudis grappling to cope with a trajectory they have no control over. With EV, heat pumps, utility scale battery storage ramp rates, not much demand left if its only aviation and plastics. Certainly not enough volume to maintain long petrol delivery supply chains, not to mention refineries reaching end of life and no one wants to invest in an industry with a death date.

https://news.ycombinator.com/item?id=39575172 | https://electrek.co/2024/03/02/1-in-5-new-car-sales-globally... ("HN: IEA: 20% of 2023 new car sales globally were EVs, curbing oil demand")

https://www.ft.com/content/b255d7b9-88f6-4481-a3a6-87542d2b7... | https://archive.today/eC5Pp ("Zombie car factories on the rise in China as buyers opt for EVs")

https://cleantechnica.com/2023/09/21/the-ev-revolution-in-5-... ("The EV Revolution in 5 Charts")

https://www.vox.com/energy-and-environment/21419505/oil-gas-... ("Big Oil’s hopes are pinned on plastics. It won’t end well.")

https://www.bloomberg.com/news/articles/2024-02-21/scotland-... | https://archive.today/nrat5 ("Scotland’s Fuel Binge Offers Glimpse of Future Without Refinery")

https://www.eia.gov/outlooks/aeo/narrative/production/sub-to... ("Refinery closures lower domestic crude oil distillation operating capacity, but refinery utilization rates remain flat over the long term")

snek_case• 2 years ago

Ok but, could we not use green electricity to capture carbon out of the air and make plastic that way? Might be more expensive, sure, but seems possible?

We can also probably reduce our use of plastic in packaging by quite a bit. Drinks used to be packaged in glass bottles. We could go back to that.

asdff3• 2 years ago

We could do a lot of things to save the earth. Action is much harder than hand waiving though. How do "we" go back to glass? Who is we? Who makes this order? How is it enforced? We can say OK we need to shut down all the gas plants and convert to nuclear starting this Wednesday, but that doesn't mean anything because good ideas don't just happen in this world. Business cases happen, and if the idea is a good one its a happy accident. We need to develop a framework where it is more profitable to turn to green choices than alternatives before we can expect the world to wake up and change overnight. And setting up such a system is impossible when indirect action and chaos theory has created the system we currently have today, one too big for anyone to fully understand or shift with a few lever pulls to no other consequence.

ars• 2 years ago

You would emit more CO2 switching to glass than you would save. It's not worth it.

Glass is heavy, breakable, and not worth recycling (the planet's crust is made of glass so there's no real reason to recycle it, the glass shards harm the recycling of everything else, and the weight consumes extra energy in transport.)

And yes, you could make plastic directly out of air. And you can recycle the plastic back into air by burning it. It's a very clean process.

Gibbon1• 2 years ago

If you do the right kind of searches you'll see people are working on using cellulose as a chemical feedstock and for plastics. That sort of research was dead since after WWII until recently.

vegardx• 2 years ago

Compared to the amount of oil used for making fossil fuels plastic is almost a rounding error. So he's technically right, but not really if you look at th bigger picture.

asdff3• 2 years ago

Ehh we can go back and forth on semantics all day but I think the point still stands that as long as there is a demand for plastics there will be no phasing out oil.

voisin2• 2 years ago

Do you have a source for this percentage?

JCM92• 2 years ago

Country at risk of heading into an economic calamity and sliding into irrelevance on the global stage puts out PR talking points saying the thing keeping them going but looking shaky is actually all just fine. Shocking.

I don’t disagree, just probably the worst spokesperson on the planet to make this point.

wslh• 2 years ago

Could you expand? From the military point of view is one of the strongest countries of the Middle East. I visited Saudi Arabia and the people live well there (e.g. health coverage) I am not making any cultural statement. Another thing that was blurred by October 7th is establishing relations with Israel.

ortusdux• 2 years ago

https://en.wikipedia.org/wiki/Economy_of_Saudi_Arabia

"The Saudi economy is highly reliant on its petroleum sector. Oil accounts on average in recent years for approximately 40% of Saudi GDP and 75% of fiscal revenue, with substantial fluctuations depending on oil prices each year."

"In 2016, the Saudi government launched its Saudi Vision 2030 program to reduce its dependency on oil and diversify its economic resources. By 2022, Saudi Arabia had only modestly reduced its dependence on oil."

JCM92• 2 years ago

If the oil revenue went away, or even declined a lot, the country would be in serious trouble. They’ve been working to get ahead of that for a long by time diversifying, but from an economic risk standpoint they’re still far too dependent on oil revenues.

j_crick• 2 years ago

sliding into irrelevance on the global stage

There’s the rest of the world out there, where these guys are nowhere near irrelevant.

Arnt2• 2 years ago

They definitely are relevant. That doesn't mean they're not sliding, though, and I imagine they're quite aware of how they're sliding. The oil companies had 99.9% market share, then 99.8, 99.5, 99, 98, 96, nowhere near irrelevant but it doesn't take a genius to see a reason why they might worry about their future.

We're at a significant point now, BTW. A few months ago, renewables reached 100% of the energy market growth, with installation rate (= market share) still doubling. It's in the single per cent of total market and doubling, and all further increase in the rate of renewable installation is also a contraction in the oil market.

not_your_vase2• 2 years ago

Now if only oil wasn't a finite resource...

eej712• 2 years ago

Everything is a finite resource. No?

not_your_vase2• 2 years ago

There are things that are more finite than the others.

For all intents and purposes energy from sun, wind and water-flow are infinite - if any of these disappears, we can be almost sure that humanity is also done, so that's one problem solved.

Some of us on this site will see the end of oil most likely however.

janalsncm• 2 years ago

I remember when Saudi Aramco went public, they initially wanted to be listed on the NYSE, but financial disclosure requirements made that unattractive for them. In other words, they refused to legally disclose how much oil is left. Now, the CEO claims that peak oil won’t happen for the foreseeable future, but if that were true why not list on the NYSE?

porkbeer• 2 years ago

Their corner on 'limited' oil production was a key selling point.

voisin2• 2 years ago

Check out the book “Twilight in the Desert” by Matt Simmons, a now deceased energy trader. He makes the case that the oil is running out in SA as evidenced by their lead in patents for ever more challenging methods of extracting oil (presumably unnecessary if their oil was so readily available). Also, the nature of OPEC is that quotas are set on reported reserves which have no third party validation. And lastly, ever since the western countries handed back oil production to SA, they have reliably been finding more and more oil every year (pumping up those reported reserves) than the western countries were ever able to find (and presumably they were quite motivated).

Arnt2• 2 years ago

Maybe. But they have a couple of extreme oil fields.

A relative in the oil industry once told me that any extra oil you can get out of an existing rig is cheaper than setting up a new rig somewhere new, no matter how much you have to invest to get at the extra oil.

r0ckarong• 2 years ago

Elite in nation built on slavery and fossil fuel struggles for relevance. More at seven.

jkingsbery• 2 years ago

“We should phase in new energy sources and technologies when they are genuinely ready, economically competitive and with the right infrastructure,”

On the one hand, that seems like a reasonable approach. On the other hand, if we only have on the order of decades of known oil reserves, we'll have to phase out of oil use at some point (likely in most of our lifetimes), no?

cs702• 2 years ago

Saudi Aramco's CEO sure seems afraid of the future. Alas, exhortations almost never work. If other sources of energy, like solar, become superior to and cheaper than oil, society will choose them over oil. Superior products at cheaper prices tend to win in the marketplace. No one ever wants to pay more for an inferior product.

maxglute2• 2 years ago

I can still forsee oil becoming another jevons paradox resource even after it gets phased out for transportation. Last I read 5% of oil production used for plastics, I can imagine a future where we adopt more plastic materials with $10-20 barrels and some new material science. MIT developed plastics comparable properties to steel a couple years ago, supposedly less resource to produce than steel/gass. Wouldn't count oil out if it can replace most steel for cladding purposes. Or even structural.

jemmyw• 2 years ago

I would expect per barrel it would become a lot more expensive if you're not extracting at the same scale. $1000 a barrel or more if you're only extracting 5% of what we are now, for chemical processes.

maxglute2• 2 years ago

I'm thinking scenario where world will be using 300% more oil by adopting 50x more plastic use for large scale application with oil selling at 1/3 of the price, loe enough to break models of more expensive extractors so cheap producers have near monopoly over commodity. All very hypothetical. But imo essentially everything you see in built environment could be covered or finished in plastic if performance / price right. I can imagine world where we use much more oil.

RetroTechie• 2 years ago

"The CEO called for a reset of the strategy that focuses on reducing emissions, not phasing out oil and gas."

In what fantasy universe does oil, once extracted, not turn into CO2 emissions shortly after?

Carbon capture hasn't been shown to work economical, at scale, anywhere afaik. Despite huge investments.

Ok you can have plastics or other uses like lubricants or paints. No wait... much of that is single use & at best ends up as CO2 as well.

dzhiurgis• 2 years ago

100 million barrels of oil equivalent per day

That's about 2 liters of oil (or 1.44 liters of gas & diesel) per person per day.

Not a lot by western standards. Absolutely enormous by some developing countries.

mikewarot• 2 years ago

The shift to other sources, combined with the rising water cut doesn't bode well for anyone depending on output from the Ghawar oil field.

jinushaun• 2 years ago

Phasing out oil completely is not what "peak oil" means

Saudi Aramco CEO says world should abandon 'fantasy' of phasing out oil

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