Saudi Aramco 'confident' in its oil demand growth forecasts

Saudi Aramco maintained its medium- and long-term demand forecasts on Aug. 6, with 52% of crude oil production output used in refining and other downstream operations in the second quarter of 2024.

Total hydrocarbons output in Q2 was 12.3 million boe/d, Aramco said in a statement to the Saudi stock exchange.

In March, CEO Amin Nasser said he expected oil demand growth of about 1.5 million b/d in 2024.

Crude oil prices were higher in the second quarter than the first quarter due to "easing inflationary pressures, expected seasonal demand growth and falling global crude oil inventory stocks," the company said.

The Q2 revenue rose 5.8% on the year to $113.5 billion, due to higher prices of crude oil, chemicals and refined products sold, along with more volumes sold from refining and chemicals. Crude oil sales, however, declined, it said.

Refining and other downstream operations used 52% of Q2 crude oil production.

Exploration in Q2 saw seven oil and gas discoveries, including two unconventional oil fields, one Arabian light oil reservoir, two natural gas fields and two natural gas reservoirs.

Exploration continues for crude oil in support of maintaining its maximum sustained capacity of 12 million b/d and "preserving Aramco's distinct operational flexibility."

The Dammam project will add oil production capacity of 25,000 b/d later in the year, while 50,000 b/d in 2027 is under construction, the company said.

Procurement and construction continued for both the Marjan project -- expected to add 300,000 b/d of production capacity by 2025 -- and the Berri project, which is expected to add 250,000 b/d by 2025 as well.

Further, the Zuluf crude oil increment, whch is expected to provide a central facility to process a total of 600,000 b/d of crude from the Zuluf field by 2026, moved forward with engineering, procurement and construction activities, according to the statement.

In January, the government ordered the company to cancel a planned expansion of its maximum sustained capacity to 13 million b/d, with the focus switched to increasing natural gas production.

The plan to increase gas production by more than 60% by 2030, from a 2021 base, is moving ahead at the Jafurah gas plant, the Tanajib gas plant and the Hawiyah Unayzah gas reservoir storage.

Aramco also awarded 23 unconventional rig contracts for $2.4 billion and two directional drilling contracts for $600 million.

Production from the Jafurah gas development is expected to reach a sustainable sales gas rate of 2 Bcf/d by 2030, along with production of ethane, NGL and condensate.

The Tanajib gas plant -- part of the Marjan development program -- is expected to be onstream by 2025 and add 2.6 Bcf/d of additional processing capacity from the Marjan and Zuluf fields.

Morever, the Hawiyah Unayzah gas reservoir storage -- the first underground natural gas storage in the country -- started reproduction of stored gas into the master gas system, providing up to 2 Bcf/d of natural gas into the master gas system based on demand, the company said.