24 May 2022
Aramco CEO warns of Global Oil Crunch due to Lack of Investment
The Index Today
Amin Nasser, the head of Saudi Aramco told Reuters that the world might face a major oil supply crunch as most of the companies are afraid to invest in the sector as they face green energy pressures, adding it cannot expand production capacity any faster than promised.
Amin Nasser, head of the world's largest oil producer, said on Monday he was sticking to the target of expanding capacity to 13 million barrels per day from the current 12 million by 2027, despite calls to do it faster.
Riyadh, Saudi Arabia has faced calls from the West to raise oil output more quickly and expand capacity faster to help combat the global energy crisis.
Nasser told Reuters on the sidelines of the World Economic Forum in Davos, "The world is running with less than 2% of spare capacity. Before COVID the aviation industry was consuming 2.5 million bpd more than today. If the aviation industry picks up speed, you are going to have a major problem."
"What happened in Russia-Ukraine masked what would have happened. We were going through an energy crisis because of a lack of investment. And it started to bite following the pandemic," he added.
Currently, Saudi Arabia is producing 10.5 million bpd, or every tenth barrel in the world, and will likely raise output to 11 million bpd later this year when a broader pact between OPEC and allies such as Russia expires, Reuters reported.