Gulf Oil and Gas accountACCOUNT

Saudi Says Oil Supply Cut Not Aimed at Lifting Prices

Source: Reuters 1/14/2013, Location: Middle East

Top oil exporter Saudi Arabia cut oil output in December because of lower seasonal demand, a senior Saudi oil ministry adviser told the state news agency, rejecting media reports suggesting the move was aimed at pushing up crude prices.

Saudi Arabia cut its crude oil production by around 700,000 barrels per day (bpd) over the last two months of 2012, with output falling to around 9 million bpd in December. It topped that up with oil held in storage to supply a total of 9.15 million bpd to the market in December.

News of the cut has helped support Brent prices at over $111 a barrel, comfortably above the $100 Riyadh says it favours.

But Saudi oil ministry adviser Ibrahim al-Muhanna said in a statement that the reduction in Saudi production late last year was due to lower demand for oil both at home and abroad.

"Saudi Arabia's production fluctuates month-to-month, and depends on a range of domestic, regional and international factors. At this point in time, production is driven by customer requirements, not by price levels. It is the market which sets the price of oil," Muhanna, an adviser to Saudi Oil Minister Ali al-Naimi, said.

"One driver of Saudi Arabia's production fluctuation is domestic demand, and this depends on seasonality. Peak demand was in the summer, but it has weakened over the last quarter, as usual. Another factor, equally important, is international customers' demand for Saudi oil. This is also seasonal," he said.

"If we look at the last quarter of 2012, for example, there were many challenges in terms of domestic growth in the Eurozone and concerns about the U.S. fiscal cliff. This, consequently, impacted the demand for oil."

Muhanna said media reports accusing Saudi Arabia of deliberately trying to push oil prices by cutting production were "categorically wrong."

He said Saudi Arabia was optimistic that economic uncertainty would pass and that economic growth would return in 2013.

"Saudi Arabia stands ready to respond to these changes, and again will meet all customers' needs. Saudi Arabia remains strongly committed to a stable oil market," he said.

Saudi production in December was more than a million barrels below its peak production last summer, when the kingdom's own oil use peaks because it burns oil to generate electricity to meet soaring air conditioning demand.

Production News in Saudi Arabia >>

Peru >>  8/21/2019 - PetroTal Corp. ("PetroTal")(TAL and AIM: PTAL) is pleased to provide an update in respect of its operations and production at the Bretana field in Blo...
Canada >>  8/16/2019 - Following an extensive investigation, flow line repairs, integrity testing and approval of the Canada-Newfoundland and Labrador Offshore Petroleum Boa...

Iraq >>  8/15/2019 - Gazprom Neft subsidiary Gazpromneft-Badra has now produced 13.5 million tonnes or 100 million barrels of oil. ...
Egypt >>  8/14/2019 - Natural gas production at Zohr, the largest gasfield in the Mediterranean Sea, more than tripled in the first half this year to reach 11.3 billion cub...

Russia >>  8/14/2019 - Exillon Energy plc (Exillon Energy), a London Premium listed oil producer with assets in two oil-rich regions of Russia, Timan-Pechora ("Exillon TP") ...
Nigeria >>  8/1/2019 - Eland Oil & Gas PLC, an oil & gas production and development company operating in West Africa with an initial focus on Nigeria, is pleased to announce...

Related Categories: Camp Building  Cleaning Equipment, Services  Communication  Corrosion Products/Services  Development  Exploration  Food Supplies  General  Labor Services  Land & Leasing  Mine Clearance  Oil & Gas Companies  Production  Service Companies  Skilled Labors  Transportation, 4X4 Trucks  Unskilled Labors  Utility Systems  Waste Disposal  Water Supply Services  Welding Products/Services 

Related Articles: Camp Building  Cleaning Equipment, Services  Communication  Corrosion Products/Services  Development  Exploration  General  Labor Services  Land & Leasing  Mine Clearance  Oil & Gas Companies  Production  Service Companies  Transportation, 4X4 Trucks  Utility Systems  Water Supply Services  Welding Products/Services 


Saudi Arabia Oil & Gas 1 >>  2 | 3 | 4 | 5 | 6 | 7 | 8 | 9 | 10 | 11 | 12 | 13 | 14 | 15 | 16 | 17 | 18 |

More News

Related Links

Gulf Oil and Gas
Copyright Universal Solutions All rights reserved. - Terms of Service - Privacy Policy.