Saudi Arabia to Determine Cost of Affordable Solar Energy for Electricity Production

Saudi Energy Minister Prince Abdul Aziz bin Salman, Asharq Al-Awsat
Saudi Energy Minister Prince Abdul Aziz bin Salman, Asharq Al-Awsat
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Saudi Arabia to Determine Cost of Affordable Solar Energy for Electricity Production

Saudi Energy Minister Prince Abdul Aziz bin Salman, Asharq Al-Awsat
Saudi Energy Minister Prince Abdul Aziz bin Salman, Asharq Al-Awsat

Saudi Arabia will begin working in March on determining the cost of affordable solar energy for the purposes of generating and producing electricity, revealed Saudi Energy Minister Prince Abdul Aziz bin Salman.

Speaking at a webinar of the International Energy Forum and the European Union hosted in Riyadh, the minister stressed the need to collectively boost cooperation on swiftly finding global solutions for harmful carbon emissions that threaten future generations.

Prince Abdul Aziz mentioned that Saudi Arabia will continue to mount international efforts in the fields of energy and climate. It is worth noting that the kingdom was among the first to sign the Paris Agreement on climate change.

More so, Saudi Arabia’s share in global CO2 emissions does not exceed 1.4%.

The energy minister further added that the kingdom is seeking to produce 50% of its energy demand from renewable sources by 2030, giving it a lead among other advanced economies.

“Next month we will begin full work on determining the cost of affordable solar energy for an electricity production model,” he told the virtual meeting’s attendees, adding that Saudi Arabia’s considerable efforts for creating green energy solutions have been successful.

Hydrogen is regarded by many experts as the clean energy of the future. Green hydrogen is produced using solar energy, and is a major feature of the energy equation at the planned NEOM megacity. In another form, “blue ammonia” is a byproduct of the oil refining process that Saudi Aramco has already produced and exported to Japan.

The need to fight global emissions is key to the “circular carbon economy” championed by Saudi Arabia as a way to achieve climate change goals, and was endorsed by G20 leaders last year under the Saudi presidency.

Prince Abdul Aziz appealed for “flexibility” by other countries in the debate over how best to mitigate climate change.

“The goal is to be flexible and mindful of the participants and their priorities,” he said.

Some countries, especially in Europe, have said they would like to move away more quickly from hydrocarbon fuels. Saudi Arabia, the world’s biggest oil exporter, believes this is the wrong approach.

To address climate change, Prince Abdul Aziz said, “you need to bring everybody on board and you need to be mindful of their priorities and you need to be mindful of how much (energy resources] they are endowed with.

“But I can guarantee you that we’re opening hands, hearts and minds to work with everybody and bring solutions to move forward and work with these ambitions, but with a difference — we are not bragging about it, not talking about it, we are executing these things and providing people with examples."

“Trust us, but more important, collaborate with us in universal solutions.”

Saudi Arabia is offering to transport “green” hydrogen by pipeline to Europe in the next stage of the Kingdom’s strategy to combat climate change.

“If Europe would like to buy more hydrogen, Saudi green hydrogen, we would be more than happy, and even, if the economics allow for it, even piping it all the way to somewhere in Europe,” said the minister.



OPEC Again Cuts 2024, 2025 Oil Demand Growth Forecasts

The OPEC logo. Reuters
The OPEC logo. Reuters
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OPEC Again Cuts 2024, 2025 Oil Demand Growth Forecasts

The OPEC logo. Reuters
The OPEC logo. Reuters

OPEC cut its forecast for global oil demand growth this year and next on Tuesday, highlighting weakness in China, India and other regions, marking the producer group's fourth consecutive downward revision in the 2024 outlook.

The weaker outlook highlights the challenge facing OPEC+, which comprises the Organization of the Petroleum Exporting Countries and allies such as Russia, which earlier this month postponed a plan to start raising output in December against a backdrop of falling prices.

In a monthly report on Tuesday, OPEC said world oil demand would rise by 1.82 million barrels per day in 2024, down from growth of 1.93 million bpd forecast last month. Until August, OPEC had kept the outlook unchanged since its first forecast in July 2023.

In the report, OPEC also cut its 2025 global demand growth estimate to 1.54 million bpd from 1.64 million bpd, Reuters.

China accounted for the bulk of the 2024 downgrade. OPEC trimmed its Chinese growth forecast to 450,000 bpd from 580,000 bpd and said diesel use in September fell year-on-year for a seventh consecutive month.

"Diesel has been under pressure from a slowdown in construction amid weak manufacturing activity, combined with the ongoing deployment of LNG-fuelled trucks," OPEC said with reference to China.

Oil pared gains after the report was issued, with Brent crude trading below $73 a barrel.

Forecasts on the strength of demand growth in 2024 vary widely, partly due to differences over demand from China and the pace of the world's switch to cleaner fuels.

OPEC is still at the top of industry estimates and has a long way to go to match the International Energy Agency's far lower view.

The IEA, which represents industrialised countries, sees demand growth of 860,000 bpd in 2024. The agency is scheduled to update its figures on Thursday.

- OUTPUT RISES

OPEC+ has implemented a series of output cuts since late 2022 to support prices, most of which are in place until the end of 2025.

The group was to start unwinding the most recent layer of cuts of 2.2 million bpd from December but said on Nov. 3 it will delay the plan for a month, as weak demand and rising supply outside the group maintain downward pressure on the market.

OPEC's output is also rising, the report showed, with Libyan production rebounding after being cut by unrest. OPEC+ pumped 40.34 million bpd in October, up 215,000 bpd from September. Iraq cut output to 4.07 million bpd, closer to its 4 million bpd quota.

As well as Iraq, OPEC has named Russia and Kazakhstan as among the OPEC+ countries which pumped above quotas.

Russia's output edged up in October by 9,000 bpd to about 9.01 million bpd, OPEC said, slightly above its quota.