Energy independence is a misleading, unachievable goal; rather, the focus should be on energy interdependence, he said. Al-Falih suggested that energy security should be addressed in the framework of a strong interdependent relationship between suppliers and consumers.
Al-Falih explained that the peak-oil concept was damaging as it contributed to great price volatility, which was harmful to consumers and suppliers alike. Although the industry faces more complex technological issues, plenty of resources are available.
Al-Falih expressed confidence in a talented work force capable of developing innovative technology to overcome future challenges. He acknowledged that fossil fuel is ultimately a finite resource but advised the audience that the world will rely on petroleum for energy needs in the long-term.
He challenged leaders to responsibly communicate that “it will take decades, not years” for an energy shift to occur. He advised that everyone should work responsibly toward a smooth, gradual transition.
The company is doing its part in this transition. “We have reached a production capacity of 12 million bpd … We produce more than 8 million, with a spare capacity of more than 4 million bpd,” said Al-Falih. “This is good for the world economy and for the Kingdom in the long-term. … It is important to the Kingdom that there will be stability in the oil industry.”
Addressing a question about investing in oil-supply security, Al-Falih noted that “upstream, one-third capacity is idle, yet ready to come onstream on a very short notice.” Saudi Aramco continues to invest heavily in all parts of the value chain, including refining, tankers, pipelines and terminals. He added that when demand/supply balances require additional capacity, “we will certainly consider it.”
Al-Falih closed by promising, “The largest supplier of petroleum energy is committed in the long-term not only to provide … hydrocarbons but to provide them to the market in a reliable and environmentally responsible way.”
The World Economic Forum annually draws world leaders to examine global development.
