Saudi Aramco CEO expects coronavirus impact on oil demand to be short-lived

Saudi Aramco expects the coronavirus impact on oil demand to be short-lived and for consumption to rise in the second half of the year, Chief Executive Amin Nasser told Reuters.

Oil prices have fallen this year as the rapid spread of the coronavirus in China, the world’s largest energy consumer, has dented demand. Prices fell again on Monday as the number of cases in countries outside China continued to climb.

“We think this is short term and I am confident that in the second half of the year there is going to be an improvement on the demand side, especially from China,” he said.

“I do not think it is going to have a long-term impact.”

Nasser said that Aramco, the world’s biggest oil-producing company, has not evacuated its staff from China and that its key marketing staff have stayed to manage the company’s business in the Asian nation.

The coronavirus has infected nearly 77,000 people and killed more than 2,500 in China, most of them in Hubei.

South Korea’s fourth-largest city, Daegu, became increasingly isolated on Monday after a rapid increase in the number of infections.

Italy, meanwhile, reported a seventh death from the flu-like virus and 220 infections in Europe’s biggest outbreak.

Kuwait, Bahrain, Oman and Iraq on Monday recorded their first new coronavirus cases, all involving people who had been in Iran, which has had 61 cases and 12 deaths.

Saudi Arabia, OPEC’s de-facto leader, has held talks with other OPEC members and Russia to discuss potential deeper oil supply cuts to counter the impact on crude prices. But Russia has yet to announce its final position on the proposal.

OPEC and allies are due to meet over March 5-6 to decide on production policy.

Reporting by Rania El Gamal and Simon Webb Editing by David Goodman

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