Saudi continues to import oil to maintain spare capacity
Saudi Arabia still continuing to import oil so it can maintain capacity
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Saudi Arabia, the world's largest crude exporter, doubled imports of fuel oil this year and is poised to maintain them at a high level to preserve its spare capacity for producing crude, Energy Aspects said.
The country imported an average of 75,400 barrels a day of fuel oil from May to September, compared with 36,200 barrels in the same period last year, according to the Joint Organisations Data Initiative. Saudi Arabia imported 164,000 barrels of fuel oil a day in September alone, the highest monthly figure since January 2002, according to the official data released on November 18.
The kingdom is seeking to maintain spare crude capacity of about 2 million barrels a day, said Amrita Sen, chief oil market analyst at Energy Aspects, a London-based consultant. Saudi imports of fuel oil and diesel were high during the summer, "a trend we expect to see continuing this year in Saudi Arabia as long as the geopolitical situation is not stable in the region," Sen said on Monday by telephone here.
Saudi Arabia has by far the most surplus output capacity among members of the Organisation of Petroleum Exporting Countries (Opec). It has produced between 9.7 million and 10 million barrels a day since November 2011, Opec data show. Opec's 12 members produce about 40 per cent of the world's oil supply.
"Saudis are seeing better demand for crude in recent months with China's demand picking up, and that's why they want to make sure there is enough crude for exports," said Sen, formerly an oil analyst at Barclays.
Saudi Arabia burned more fuel oil, and boosted supplies of natural gas for domestic use, to free crude for export during the summer. National gas-production capacity rose by 18 per cent in July, when the Karan field was able to produce 1.8 billion cubic feet a day, Saudi Arabian Oil Company said on October 16. Gas from Karan wasn't enough to satisfy additional domestic needs, and the country also increased fuel imports, Sen said.
The country used 722,400 barrels a day of crude on average to generate electricity from May to September, up 3.2 per cent from a year ago, JODI data show. JODI, supervised by the Riyadh-based International Energy Forum, compiles statistics supplied by national governments on oil production, imports and exports.