Saudi Cuts to Asia’s Oil Supplies Total 15 percent
The Saudi Arabian Oil Co. (C.SOI), or Saudi Aramco, has informed its buyers in Japan and South Korea that it will make an additional 3.3 percent cut to their April-loading term crude volumes, on top of its previous 11.7 percent cut announced last week, traders said Monday, cited by Dow Jones Newswires.
"We received the fax from Saudi Aramco this morning and we were told that our April volumes will be cut by another 3.3 percent," one Tokyo-based trader told Dow Jones.
Last week, Saudi Arabia told buyers their April-loading term crude volumes will be cut by 11.7 percent.
The latest announcement would bring the total cut from Saudi Arabia to 15 percent, traders said.
Meanwhile, AFP reported that oil prices drifted higher in early trading on Monday in response to a new output cutback announced over the weekend by the Organization of Petroleum Exporting Countries (OPEC).
The price of a barrel of Brent North Sea crude for May delivery firmed by 23 cents to 25.28 dollars.
In New York, the April light sweet crude contract gained 19 cents on Friday to 26.74 dollars a barrel.
Analysts were quoted by the agency as saying that the OPEC decision Saturday to cut production by one million barrels a day, which followed a January move to squeeze output by 1.5 million barrels a day, had been all but factored into the market.
OPEC has now cut output by almost 10 percent this year to rescue prices, which have fallen from high points above 35 dollars a barrel last autumn to below 24 dollars in recent days.
OPEC's own basket price of seven crudes, which it uses to help set production policy, stood at 23.09 dollars a barrel on Friday, up from 22.77 dollars on Tuesday, the Vienna-based OPECNA agency said.
OPEC, which is targeting a basket price of 25 dollars, is concerned that prices could slump as demand wanes going into the northern hemisphere summer -- Albawaba.com
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