Oil prices fell on Thursday for the first time in three days after San Francisco Federal Reserve President Mary Daly sounded a note of concern about the strength of U.S. economy. Concerns about a slowdown in economic growth due to the trade war raging between the United States and China, along with the potential hit to oil demand, are keeping prices in check. Daly said on Thursday she believes the U.S. economy has “strong” momentum, but uncertainty and a global growth slowdown are having an impact.
Saudi Arabia’s long-awaited drive to free up more oil revenue by shifting to solar power generation is expected to pick up speed next quarter, according to local developers eyeing contracts.
“I’m fully expecting within the first quarter 500 megawatts to come out in tenders and then it’ll ramp up,” said Paddy Padmanathan, the chief executive officer of Acwa Power International in Riyadh. “That will be a game changer for the region.”
The world’s biggest crude exporter also burns more oil than any other country to generate electricity. According to the most recent International Energy Agency figures, the kingdom consumes at least 900,000 barrels a day at peak periods of the year to keep the lights on — an amount worth over $16 billion a annually based on current oil spot prices. Integrating more solar power onto the Saudi grid could free up more crude for export.
Saudi Arabia plans to add another 700 megawatts from wind and solar power generation in 2018 according to people familiar with the plan, who said the kingdom forecasts another 8.8 gigawatts of renewable energy added to the grid between 2019 and 2023.
“We expect Saudi Arabia will be the largest market in the region in the medium to long-term,” said Sami Khoreibi, the founder and chief executive officer of Enviromena Power Systems, a solar developer based in Abu Dhabi. “You take a look at the opportunity cost of using crude oil for electricity production and you have a very high operating expense, and the power demand growth in Saudi Arabia is one of the largest in the region.”
more at: https://www.bloomberg.com/news/articles/2016-12-21/saudis-seen-accelerating-sunward-tilt-in-charge-for-oil-revenue