In the name of Allah, the Most Gracious, the Most Merciful
Good morning, ladies and gentlemen. We are gathered here today in the presence of esteemed guests, including the Right Honorable Dato’ Seri Anwar Ibrahim, Prime Minister of Malaysia, to commence this auspicious occasion.
Kuala Lumpur, the vibrant capital city of Malaysia, provides a delightful backdrop for visitors, particularly on the eve of the auspicious occasion of Eid al-Adha. It is with great honor that we welcome the presence of the Prime Minister among us today.
We extend our gratitude to Tan Sri Tengku Muhammad Taufik and his team for their gracious hospitality and for orchestrating this timely conference.
In the complex landscape of the energy market, the ongoing conflict in Ukraine has added a layer of intricacy that cannot be overlooked. In an analysis of the current state of the oil market, it is evident that the fundamentals are expected to remain stable and robust throughout the remainder of the year.
Amidst the looming recession risks faced by numerous OECD countries, it is the developing nations that are spearheading a robust surge in oil demand, with China and India leading the charge. This year, these burgeoning economies are expected to drive remarkable growth of over 2 million barrels per day.
The current level is notably high when compared to historical standards. Despite China's current economic challenges, there are encouraging signs of growth in the transport and petrochemical sectors.
In a statement, it was expressed that there is a prevailing sense of optimism regarding the market's potential for the remainder of the year. As the broader global economy begins its recovery, it is anticipated that supply-demand balances will tighten even more.
In today's discourse, the primary emphasis lies on the prospective energy landscape of Asia. Asia's Role in Shaping the Global Energy Transition Debate: A Call for Better Representation Inquiring about the alignment of Asia's and Aramco's perspectives on future energy
Asia's Ascendancy: A Closer Look at its Economic Dominance With an impressive growth trajectory, the region has solidified its position as a dominant player in the global economy. Currently, it commands a substantial 46 percent share of the world's gross domestic product (GDP), a figure that is projected to reach the significant milestone of 50 percent by the year 2050. This remarkable progress underscores the region's increasing influence and economic prowess on the global stage.
In contrast, the share of North America stands at less than 20 percent, whereas the European Union's share is a mere 15 percent.
In Asia, a remarkable trend is emerging as people experience an improved standard of living. Over the past few decades, the region has witnessed a significant surge in GDP per capita, soaring from a mere thousand dollars in 1980 to an impressive figure of over eighteen thousand dollars at present. This noteworthy development reflects the growing prosperity that individuals across Asia are currently enjoying. According to projections, Asian economies are poised to dominate the global economic landscape by 2050, with three out of the top five largest economies hailing from the region. This shift in economic power is expected to be driven by the remarkable growth rates witnessed in emerging markets, which are anticipated to outpace their developed counterparts by a significant margin.
Seismic changes are currently underway.
In regards to the energy transition, there is a concern that the interests of this vibrant region are not being sufficiently represented in the prevailing narrative surrounding the energy transition and the policies currently in place.
In an effort to tackle the pressing issue of environmental sustainability, existing transition policies have been implemented with due diligence. The issues of energy security and affordability, which are equally critical, are not receiving sufficient emphasis.
Energy transitions have proven to be intricate and time-consuming endeavors, as we have come to understand through our collective experience. The notion of completely overhauling a 100 trillion-dollar global economy within a mere 25 years may seem far-fetched.
In an era of global energy transition, experts argue that a one-size-fits-all approach to policy implementation may have unintended consequences for nations at varying stages of economic development. The indiscriminate application of energy transition policies across all countries could potentially undermine the competitiveness of those still striving to achieve economic maturity.
The entirety of Asia is impacted by all of these developments. The underdeveloped regions of Asia are confronted with particularly daunting realities.
In a startling revelation, it has come to light that a staggering 2 billion individuals, accounting for nearly half of the region's population, are deprived of clean cooking fuels. This dire situation not only poses a grave threat to their health but also wreaks havoc on the environment. Approximately 150 million individuals currently lack access to electricity, while another 350 million have only limited access. Shockingly, nearly one billion people endure frequent power interruptions, highlighting the dire state of global electricity accessibility.
The scene before us presents a strikingly diverse tableau. In certain regions across Asia, a significant portion of the population continues to grapple with the fundamental issue of lacking access to essential energy resources, hindering their ability to escape the clutches of poverty.
In light of its status as a burgeoning economic force and its expanding population, Asia finds itself in need of ever-increasing quantities of reliable energy sources to sustain the continuous growth of its burgeoning middle class. The path to prosperity is facing growing threats due to the policies implemented during the current transition.
At the forefront of the transition, the outlook remains far from optimistic.
In the past decade, electric vehicles, solar power, and wind energy have made notable contributions to the global energy landscape. However, it is worth noting that their growth has failed to keep pace with increasing global energy consumption.
The energy equivalent cost of green hydrogen remains within the range of $200 to $400 per barrel, in stark contrast to the current price of oil, which hovers around $75. The global demand for conventional energy sources such as oil and gas has witnessed a steady rise, with coal retaining its position as the primary source of electricity worldwide.
The prevailing narrative surrounding the oil and gas industry, coupled with the current transition policies, has resulted in a significant decrease in investment in this sector over the past decade. In the wake of shocks like the ongoing conflict in Ukraine, it comes as no surprise that a considerable number of individuals find themselves grappling with an energy crisis.
When one places all their transition eggs in the new energy basket, they find themselves in a precarious situation when that basket proves incapable of bearing the load.
Amidst the challenges posed by energy security, affordability, and environmental sustainability, there is a glimmer of hope emerging. It is becoming increasingly evident that, in order to tackle these issues effectively, global transition policies need to adopt a more pragmatic, orderly, and inclusive approach.
In a bid to promote diverse energy sources and expand the use of alternative options, efforts are being made to encourage the parallel operation of various forms of energy. The aim is to simultaneously harness multiple energy sources while simultaneously increasing the capacity and effectiveness of alternative solutions. Amidst a surge in global initiatives, spearheaded by our very own industry, to significantly diminish the environmental impact of traditional energy sources.
The inclusion of this powerful instrument of efficiency enhancement is noteworthy. Asia could greatly benefit from embracing a multi-speed transition model, which would aid in its development and progress. Calls for Adequate Financial Support to Aid Developing Countries in Climate Change Adaptation and Energy Transformation Amidst the pressing challenges posed by climate change, there is a growing chorus of voices advocating for the provision of appropriate levels of financial support to developing nations. This support is seen as crucial in enabling these countries to effectively adapt to the impacts of climate change and facilitate the much-needed transformation of their energy systems.
A growing consensus is emerging regarding this shift in direction, bringing a sense of relief.
China and Japan, two major energy consumers in Asia, are emphasizing the importance of realistic and inspirational transition policies. In order to effectively reduce dependence on traditional energy sources, it is imperative that the implementation of alternative energy solutions be well-established and readily available.
Experts emphasize the importance of pursuing a diverse approach towards achieving carbon neutrality, considering the varying economic and energy landscapes across the globe. However, there is still much work to be done in order for this pragmatic approach to be implemented on a global scale.
Asia's Great Opportunity: A Platform to Amplify Unique Transition Priorities In a world that is constantly evolving, Asia finds itself at a crucial juncture—a moment that presents a remarkable opportunity to make its voice heard, louder and clearer than ever before. This region, with its diverse nations and cultures, is poised to seize the spotlight and articulate its distinctive transition priorities on the global stage. In order for Asia to truly assert its economic prowess, it is imperative that its transition voice align with its economic voice.
Aramco is taking decisive steps to transform this pragmatic approach into tangible action.
In a bid to address the growing concern over insufficient global investments in the oil and gas sector, we are steadfastly committed to bolstering our upstream operations. In a bid to further combat climate change, our company is ramping up its initiatives to decrease the carbon intensity of our upstream operations, which currently stands at a comparatively lower level.
In our pursuit of mitigating greenhouse gas emissions from conventional energy sources, we are actively engaged in various technological endeavors. These include initiatives such as carbon capture and storage (CCS), circular carbon economy, and direct air capture.
In a significant development, the supply of oil we provide holds the potential to play a crucial role in assisting Asian countries in their pursuit of meeting emissions reduction targets. In a bid to further bolster our operations, we are currently ramping up the growth of our downstream and chemicals businesses.
In a bid to expand their energy offerings, the company has announced the addition of several new, environmentally friendly products to its portfolio. Among these additions are hydrogen, ammonia, methanol, and e-fuels, all of which boast lower carbon emissions. In the realm of global net-zero ambitions, our strategies extend beyond mere considerations of a realistic energy transition.
In addition, they recognize the imperative of a shift in materials, encompassing the utilization of oil and gas in sustainable materials that serve as the fundamental components of contemporary existence.
In a strategic move, our company is significantly ramping up its endeavors to establish itself as the preferred energy provider in Asia.
Korea has embarked on a massive petrochemical project worth a staggering seven billion dollars in collaboration with S-Oil, marking a significant milestone in the country's industrial development. In a parallel development, our company has recently entered into agreements for two substantial investments in China's chemicals sector, with a combined value reaching into the billions of dollars. PrefChem's joint venture with Petronas in Johor stands as a testament to the unwavering confidence that our company holds in Malaysia and the wider ASEAN region.
Partnerships form the common thread, connecting individuals we have personal relationships with and reliable companies we can rely on, all within a region that commands our utmost respect. In response to the surging demand for energy, chemicals, advanced materials, lubricants, and new lower-carbon energy in Asia, we are intensifying our efforts. With a focus on game-changing technologies, we are committed to meeting these needs and positioning ourselves as Asia's comprehensive solution provider. Our objective is to strike a delicate balance between ensuring energy security and affordability while promoting environmental sustainability.
In a bold move that signifies a significant milestone, Saudi Arabia has unveiled its largest capital expenditure program to date. With an unwavering commitment to fostering investment opportunities, the kingdom is now intensifying its efforts to attract Asian companies. This strategic decision reflects Saudi Arabia's determination to solidify its position as a lucrative destination for businesses in the region.
In a region where forward-thinking is deeply ingrained, it is evident that many individuals, both male and female, share a common perspective on envisioning the future. Rather than focusing on short-term periods or cyclical patterns, the people of Asia tend to adopt a long-term outlook, contemplating the future in terms of decades and eras.
In an era dominated by Asian influence, it is evident that the future lies within the continent of Asia. In a call for collective action, the speaker emphasizes the need for a fresh perspective on energy transition that takes into account the distinct priorities of Asia. By harnessing our collective power, the potential to provide the energy future that Asian economies and their people truly deserve becomes within reach.
In a show of gratitude and cultural appreciation, the user extends their heartfelt thanks while also acknowledging the joyous occasions of Eid Mubarak and Selamat Hari Raya Haji.