Saudi Arabia is the world’s fourth-largest oil consumer at 3.7 million b/d, following the U.S., China, and India. According to Bloomberg columnist Javier Blas, if Saudi Arabia does not reduce its oil consumption, the global peak in oil consumption may not occur by 2030.

Blas highlights that the IEA forecasts a reduction in Saudi Arabia’s oil demand by 500,000 b/s.

“In short, global oil demand may not peak until 2030 if Saudi Arabia plays it right and embarks on a massive oil conservation program. If it doesn’t, the global numbers don’t add up,” the article states.

The power and water sector accounts for about 25% of Saudi Arabia’s total oil consumption.

During the seasonal peak, typically in late August and early September, Saudi Arabia burns approximately 1.4 million b/d of unrefined crude oil and fuel oil in its power plants, equivalent to France’s total daily oil consumption. Riyadh aims to save about 1 million b/d by 2030. Saudi Aramco expects that in six years, almost 50% of the utility sector will be powered by renewables, and 50% by gas.

However, these plans may face delays due to their scale. The kingdom will need to upgrade and build new power plants and invest billions of dollars in more energy-efficient desalination plants.

“It may seem counterintuitive, but if global oil demand peaks soon, Tesla and its electric car rivals aren’t the only companies to watch. Equally important will be Saudi state-owned electricity and water companies,” Blas concludes.