Weekly MENA Newsletter will be delivered to your email in PDF format every Friday (52 Issues per Year).
MEES analysis of customs data for key importing countries for the first nine months of 2015 shows that Saudi Arabia is only just managing to hold on to its crude market share in key east Asian consuming countries, despite producing at record volumes.
Saudi Arabia has been struggling to keep crude exports at above 7mn b/d despite output running at record levels of over 10mn mn b/d since March. Record refinery runs and crude burning together with a build-up in stocks have cut into the volume available for export (see graph 1).
Influential local investment bank Jadwa says that it expects Saudi crude output to average 10.1mn b/d not only for 2015 (a figure that implies an average of just under 10.1mn b/d for the remainder of the year) but also for the whole of 2016. “Even as non-Opec supply slows in 2016, we see competition amongst Opec members keeping yearly Saudi production at 10.1mn b/d in 2016 as well,” Jadwa says. By ‘competition among Opec members’ Jadwa is referring to Iraq, which is now Opec’s undisputed number two having raised output by almost 1mn b/d to 4.2mn b/d over the past year (outpacing even Saudi Arabia’s own output ramp up – see graph 2), and to Iran which plans to hike output by 1mn b/d to around 3.8mn b/d as sanctions ease next year. Of course Iran’s plans to hike output and exports and regain market share totally undermine its own calls on Opec (for which read Saudi Arabia) to cut output in order to support prices. (CONTINUED - 899 WORDS)