Aramco chief optimistic about second-half of 2020 as China gasoline and diesel demand accelerates

Aramco chief optimistic about second-half of 2020 as China gasoline and diesel demand accelerates
IHS Markit Vice Chairman Daniel Yergin and Saudi Aramco CEO Amin Nasser. (Screengrab)
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Updated 30 June 2020

Aramco chief optimistic about second-half of 2020 as China gasoline and diesel demand accelerates

Aramco chief optimistic about second-half of 2020 as China gasoline and diesel demand accelerates
  • Amin Nasser: I’m very optimistic about the second half of this year. We see it in China today – it’s (oil demand) almost at 90 percent
  • Amin Nasser: I think we are much better prepared now. All countries, all medical establishments are much better prepared. We learned a lot during the first wave

LONDON: Saudi Aramco CEO Amin Nasser expects oil demand to rebound in the second-half of the year as more countries ease travel restrictions. 
He made the disclosure during an interview with IHS Markit Vice Chairman Daniel Yergin.
“The worst is behind us,” said Nasser. “I’m very optimistic about the second half of this year. We see it in China today – it’s almost at 90 percent. In gasoline it’s around 95 percent in China. Gasoline and diesel are picking up to pre-COVID levels. Jet fuel is still lagging in terms of less air travel. More countries will start opening up. So, we see that reflected in the demand on crude.”
The oil executive said that the pace of recovery would depend on whether there was a second wave of the COVID-19 coronavirus but that the experience of countries in dealing with the pandemic had made them better prepared for any recurrence.
“I think we are much better prepared now. All countries, all medical establishments are much better prepared. We learned a lot during the first wave,” he said.
He made his remarks as OPEC oil output drops to its lowest in two decades.
OPEC pumped 22.62 million barrels per day (bpd) on average in June, according to a Reuters survey published on Tuesday. That was a decline of about 1.92 million bpd from May.

The OPEC+ group which includes OPEC as well as Russia and some other producers, agreed to cut about 10 percent of global oil output from May 1.
The cuts have helped to support an oil price which dropped to as low as $16 in April, representing a 21-year low.
Now analysts expect the oil price to settle around $40-a-barrel this year according to the latest Reuters poll.
Nasser said that Aramco’s localized supply chain helped to mitigate against the impact of supply interruptions during lockdowns.
“We have seen a lot of plants and factories and suppliers that support Saudi Aramco from Europe, including China and other places – they had to shut down because of the lockdown. That impacted us for a while. But because of the optimum level of inventory that we have . . . a lot of things are being manufactured in the Kingdom – it helped us a lot.”


Qatar National Bank sees gradual growth in Saudi Arabia after end of rift

Qatar National Bank sees gradual growth in Saudi Arabia after end of rift
Updated 2 min 10 sec ago

Qatar National Bank sees gradual growth in Saudi Arabia after end of rift

Qatar National Bank sees gradual growth in Saudi Arabia after end of rift
  • QNB opened its branch in Riyadh in May 2017, just a month before the dispute erupted
  • Bank would rebuild its information technology infrastructure and the banking team

DUBAI: Qatar National Bank (QNB), Gulf’s biggest bank by assets, expects its business in Saudi Arabia will pick up only gradually after reviving its Riyadh branch that was dormant for more than three years due to a diplomatic and economic rift.
A QNB executive made the comments to analysts on Monday after Riyadh announced a deal on Jan. 5 to end the dispute with Doha that forced Qatari firms to halt business in the kingdom and its airline to reroute flights around Saudi airspace.
QNB opened its branch in the Saudi capital in May 2017, just a month before the dispute erupted.
QNB Group Chief Financial Officer Ramzi Mari told analysts that the impact of reopening its Riyadh branch would be gradual, analysts who joined the call said.
The bank would rebuild its information technology infrastructure and the banking team in Riyadh, Mari said, according to the analysts who did not give further details.
QNB declined to comment.
Saudi Arabia, along with United Arab Emirates, Bahrain and Egypt suspended diplomatic and transport ties with Qatar, accusing Doha of supporting terrorism. Qatar denied the charges and said the embargo was meant to undermine its sovereignty.
Qatar National Bank last week reported a drop in annual profit of more than 16 percent, hit by $1.6 billion in impairments during a year when the region’s economy was affected by the coronavirus outbreak.