RIYADH - Saudi Aramco CEO Amin Nasser said on Wednesday planned European embargoes on Russian crude and products were adding to uncertainty in the global oil market.
Nasser also said that market realignments were taking place with discounts being offered by Russia.
"The Russians, with the right discounts, they are able to place their crudes in different markets," Nasser said, adding that crude from other producers in the meantime was being redirected, noting crude destined for Asia was being sent to Europe, North America and elsewhere.
The Group of seven countries agreed last month to cap Russian oil sales at an enforced low price by Dec. 5 but have faced consternation from main players in the global oil industry.
Addressing the Future Investment Initiative (FII) forum in Riyadh after announcing a $1.5 billion sustainability fund to support a stable and inclusive energy transition, Nasser said the current global plan to switch from transitional fossil fuels to new forms of energy was flawed.
"We see today if you look at coal it is 8 billion tonnes, this is the highest since 2013. The cost of coal per barrel of oil equivalent is $60-$80, so basically we are transitioning to coal."
Nasser said the market for blue hydrogen was "building up" but that it was so far costly at around $200-$300 per barrel of oil equivalent.
"The market that has been identified is mainly in Japan and South Korea," he said.
"It is picking up in Europe and other parts of the world but it will take time because everybody is looking at technology and cost going down."
Blue hydrogen is obtained through capturing carbon from crude oil, storing it underground and mixing it with ammonia.
(Reporting by Aziz El Yaakoubi, Hadeel Al Sayegh, Rachna Uppal and Maha El Dahan; editing by Jason Neely and David Evans)