Saudi Arabia's Energy Minister Prince Abdulaziz claimed last week that the
Kingdom will be the world's biggest hydrocarbon producer "even" in
"I can assure that Saudi Arabia will not only be the last producer, but
Saudi Arabia will produce every molecule of hydrocarbon and it will put it to
good use...It will be done in the most environmentally sound and safe way and
the most sustainable way," Abdulaziz said when asked about the oil market
outlook in 2050 during a virtual conference convened by Saudi Arabia's Future
Investment Initiative Institute (FII-I).
Abdulaziz added that Saudi Arabia "will be the last and biggest producer
of hydrocarbon even then," referring to 2050.
But is Saudi Arabia's the world's leading hydrocarbon producer now? And what is
its legitimate prospect for being the largest hydrocarbon producer in 2050?
To unpack what the prince is claiming, we first must understand the hydrocarbon
classification. A hydrocarbon is an organic compound that contains only carbon
and hydrogen. This encompasses petroleum, natural gas, and condensates.
Is Saudi Arabia the world's largest hydrocarbon producer?
Saudi Arabia's oil production in 2019, which includes crude oil, all other
petroleum liquids, and biofuels--this would include natural gas plant liquids
and condensate--was an average of 11.81
million bpd, according to the Energy Information Administration (EIA). At
12% of the world's total, it's no wonder why Saudi Arabia holds so much market
sway, especially when in cahoots with the rest of the OPEC members.
Russia, too, is right up there, producing an average of 11.49 million bpd, or
11% of the world's total. This is also no wonder, then, that when you put
Russia and Saudi Arabia together to "stabilize" the world's oil
supply to balance it with demand, it creates a crude oil production powerhouse
that is unmatched.
But individually speaking, Saudi Arabia is not king of the oil production hill,
for its nemesis--the country that sought to undo every production quota OPEC
could come up with, is the United States. On its own, the United States
produced 19.51 million barrels of oil (and other petroleum liquids) per day,
besting both Saudi Arabia and Russia, and controlling 19% of the world's oil
The rest of the countries on their own are significantly further down the list,
with not one of them producing more than half of third-place Russia. Still,
Canada and China--#4 and #5 respectively--are still worth mentioning.
But Saudi Arabia expects to be the largest hydrocarbon producer
"still" in 2050. If they are not so now, what are the chances they
will be so thirty years from now?
Perhaps out of step with Saudi Arabia's grand Vision 2030 plan, The Kingdom is
still hoping to be top dog for petroleum production decades from now.
The EIA, in its Annual Energy Outlook 2020, has forecast that global production
of crude oil and lease condensate, natural gas plant liquids, dry natural gas,
and coal in the United States will reach 90.29 quadrillion Btus in its
reference case. For crude oil and lease condensate, the EIA expects that the
United States will be on par with where it is today, in its reference case. For
natural gas plant liquids production, the EIA anticipates an increase by 2050.
The reason for the EIA assuming oil production will level off in 2022 and
holding fairly steady through 2045 is the anticipated decline in well
productivity, forcing tight oil producers to hunt for oil is less prolific
For Saudi Arabia, its 30-year hydrocarbon plan or abilities are more of an
unknown. It has the world's second-largest crude oil reserves, and it does have
plans to add natural gas production in the coming years as it looks to step
away from its near-total reliance on crude oil.
For natural gas, Saudi Arabia announced earlier this year that it may actually
bring forward its plans to export natural gas by 2030. It did not, however, provide details about
this plan, or how it would be implemented.
But its detail less plans may run into some trouble. For starters, while Saudi Arabia
has an excess of low-cost associated gas reserves that it could tap, the
production of said gas would be limited to the amount of crude it can produce.
And crude oil production is periodically--and profoundly so right now--capped
by OPEC agreements that keep the Kingdom's fossil fuel ambitions in check.
But the EIA sees the OPEC countries besting non-OPEC countries on the
production front by 2050
By 2050, the EIA sees the production of crude oil, lease condensate, natural
gas plant liquids (NGPLs) and other liquid fuels from 2018 to 2050 reaching
121.5 million barrels per day (b/d) in 2050, or about 21% more than 2018
For crude oil and lease condensate, the EIA sees OPEC members increasing
production by 9.5 million bpd, and non-OPEC countries increasing their crude
oil and lease condensate production by 8 million bpd. This translates into a
27% increase for OPEC countries and a 17% increase for non-OPEC countries,
according to the EIA's International Annual Energy Outlook.
Overall, the EIA expects the OPEC countries to produce 56% of total global
production in 2050.
Most of that production increase that OPEC nations (27%) will see will come
from the Middle East, which is expected to increase by 35% to 2050.
Meanwhile, production in Russia (14%) and Canada (123%) are expected to
increase at a quicker rate than the United States (8%) and Brazil (50%).
Using historical production figures courtesy of BP and forecasts published by peakoilbarrel, the top four oil producers remain in their
positions through 2050.
Toeing the Saudi Line
Prince Abdulaziz's chest-puffing seems to be in line with Saudi Arabia's previous
assertions that oil will be alive and well in 2050 despite attempts to spur the
world along an energy transition. Even as far back as 2007, Aramco said it
could boost reserves to as many as 1 trillion barrels by 2027, adding that it would be 2050 or
later before production peaks.
But some of Saudi Arabia's forecasts of fossil fuel's future were more
sober-minded, even seeing a phasing out of fossil fuels by the middle of this century,
Ali al-Naimi, Saudi Arabia's oil minister at the time said in 2015.
"In Saudi Arabia, we recognize that eventually, one of these days, we are
not going to need fossil fuels. I don't know when, in 2040, 2050 or
thereafter," al-Naimi said, adding that Saudi Arabia was therefore
planning on becoming a "global power in solar and wind energy."