RIYADH: Crude exports from Saudi are on the rise from a 2014 low. In a rare interview with an Indian publication, the usually reticent, soft-spoken oil czar also strongly disagreed with Indian counterpart Dharmendra Pradhan’s forcefully articulated assertion that countries like Saudi Arabia were unfairly charging an “Asian premium.’ This refers to allegedly higher rates for oil sold to Asia compared with supplies to distant western buyers”.
Al-Naimi said Saudi Arabia was interested in investment in refining, marketing and petrochemicals in India, for which the kingdom has been in talks for a few. “U.S. crude stocks are now back up to more than 100 million barrels above the level seen a year ago”, the report says, adding despite increase violence and volatility in Syria, the fundamentals remain.
Saudi Arabian Oil Co., known as Saudi Aramco, in an e-mailed statement on Sunday said it reduced its official selling price for Medium grade crude to Asia to a discount of USD3.20 a barrel below the regional benchmark. Since Y 2007, this is the 2nd-highest Saudi exports in 1-H of the year to those countries. If Dubai crude rises relative to Brent, then oil from Atlantic basin suppliers, especially Angola and Nigeria, becomes more competitive for Asian refiners.
Naturally, the current low oil prices are having a devastating impact on the Venezuelan economy. At that meeting, Russian Federation refused to cut its own production in a bid to support prices – somewhat understandably given that OPEC itself has maintained record production levels. Saudi exported more than 2.2 million bpd to the United States in May 2003 and now meets around 15 per cent of total USA imports, down from a third in the early 1990s. Shipments in 1-H of Y 2015 to European members of the Organization for Economic Cooperation and Development (OECD) were the highest since Y 2006 averaged at about 1.01-M BPD, according to worldwide Energy Agency data.
Russian Federation is expected to produce 525 million tonnes or 10.5 million barrels per day (bpd) next year, Novak said. “We are also committed to ensure supplies that are essential for India”, he said. OPEC has exceeded this official target every month since May 2014. The break-even point for US production is hard to pinpoint exactly, but it can be said for certain that $40 oil does not allow for a profit to be made. “Look at demand first”, this source said.
