Oman is dispelling rumors that it has lost customers and is facing production problems, according to statements made by Omani oil officials on December 4th.
Muscat, one of the Gulf’s largest non-OPEC crude producers reportedly set its retroactive selling price for November crude at a 24 cent a barrel discount to Middle East benchmark crude Dubai, reflecting a cut of 26 cents a barrel from its October price of 2 cents a barrel above Dubai.
An Omani oil official said that: “Contrary to what traders are saying, we are not short of buyers since our Far East customers remain committed to us. Our crude prices are never inflated but competitive, a true reflection of the market’s sentiments, and they will remain attractive to buyers.”
China and Japan are two top buyers of Omani crude, which is a medium sour blend. According to the official, “We should be able to achieve an average of nearly 900,000 b/d by the end of the year delivered to our customers.”
Petroleum Development Oman (PDO), a consortium compromised of the Omani government (60 percent), Royal Dutch/Shell (34 percent), Total (4 percent) and Partex (2 percent), holds more than 90 percent of the Gulf state’s crude reserves and accounts for about 94 percent of Omani crude output. Shell operates most of Muscat’s key oil fields.
An official with PDO said on December 4th that: “We started poorly at the beginning of the year, but production improved later on and we will reach our production target this year of an average of 850,000 b/d.”
New Omani fields are anticipated to contribute a total of 62,000 b/d, which will help offset losses from ageing fields. Smaller Omani producers are expected to be bringing on additional output of 40,000-45,000 b/d.