(Bloomberg) — Saudi Arabia plans to boost oil exports even further from April to May, reaching a record of more than 10 million barrels a day as the kingdom taps a new field.
The increase in shipments of about 250,000 barrels a day shows the kingdom is determined to carry on with its policy of pumping flat out after its alliance with Russia collapsed. Moscow and Riyadh are engaged now in a price war that has sent Brent crude, the global benchmark, below $30 a barrel and prompted energy companies including Exxon Mobil Corp. to plan for big spending cuts.
“Saudi Arabia will utilize the gas produced from the Fadhili gas plant to compensate for around 250,000 barrels a day of domestic oil consumption, which will enable the Kingdom to increase its crude exports during the coming few months to exceed 10 million barrels a day,” the kingdom’s Energy Ministry said in a statement on Tuesday.
Oil erased earlier gains, with Brent falling 2.3% to $29.37 a barrel as of 1:54 p.m. in London.
Saudi Arabia has told refiners it plans to supply 12.3 million barrels a day in April, a record, although the kingdom hasn’t said how much oil it will export during the month. According to the International Energy Agency, Saudi Arabia consumes an average of 3.15 million barrels a day, suggesting that exports would be capped at slightly above 9.15 million barrels a day. The new gas plant would help the kingdom boost exports above that level.
Before the price war broke out, Saudi oil exports averaged just under 7 million barrels a day from December to February, according to tanker-tracking data.
Price War
Riyadh, Moscow and several other members of the Organization of Petroleum Exporting Countries are boosting their exports just as global oil demand suffers an historic contraction due to…
Source: FuelFix
