MIDDLE EAST Energy Review

By Tsvetana Paraskova

OPEC, led by its biggest producers in the Middle East, raised its demand forecast for Chinese oil consumption this year, while the world’s biggest oil firm by both production and market capitalisation, Saudi Aramco, reported a record profit for 2022 and a record for any oil company ever.

OPEC sees higher Chinese oil demand

OPEC left in the middle of March its estimate for global oil demand growth this year unchanged from the February assessment, but raised slightly its forecast for China’s demand.

“In the emerging economies, China’s reopening, following the lifting of the strict zero-COVID-19 policy, will add considerable momentum to global economic growth,” OPEC said in its Monthly Oil Market Report (MOMR) for March in the middle of the month, when global financial markets were roiled by concerns about the health of the banking sector in the United States and Europe.

China’s oil demand is expected to average 15.56 million barrels per day (bpd) in 2023, up by 710,000 bpd compared to 2022, according to OPEC’s latest estimate. The forecast is higher than the 590,000-bpd growth expected in OPEC’s report for February.

“A stronger-than-anticipated rebound in China, with consumption accelerating significantly, following years of stringent lockdown measures, is another factor to be considered,” the organisation said, commenting on the upsides and downsides for global oil demand this year.

Saudi Arabia raises oil prices to Asia again

Amid expectations of rising demand in China, Saudi Arabia’s oil giant Aramco, the world’s single largest crude oil exporter, raised its official selling prices (OSPs) for its crude loading for Asia in April, for a second consecutive month of an increase in prices.

Thus, Saudi Arabia’s flagship Arab Light crude will sell in April in Asia for $0.50 per barrel more than in March. The increase in prices was the second consecutive month with higher prices for Saudi crude loading for Asia. The price hike in February for the March prices came as a surprise to the market as it was the first time in six months that Aramco had hiked prices for its crude.

Saudi Aramco Books Record Profit for 2022

Meanwhile, Aramco, the world’s biggest oil firm by market capitalisation and production, reported in March a record-breaking net profit for 2022.

Aramco announced a full-year 2022 net income of $161.1 billion — its highest annual profits as a listed company, thanks to stronger crude oil

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