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Saudis to raise September oil price, but wary of losing market share

Oil pumps are seen at a MAX oil station in Yangon April 21, 2014. Saudi Arabia is expected to raise prices for crude it sells to Asia in September due to a stronger Dubai benchmark, traders and analysts said on Monday, adding that the top oil exporter will be wary of a hike so big it would threaten its market share. OPEC’s efforts to discourage growth from rival supply sources are bearing fruit as the group continued to pump at record levels in July. Still, raising prices when Asian refiners are cutting runs because of weak margins could hurt demand for Saudi oil, the traders and analysts said. "It’s an awkward decision," a Singapore-based trader said. "They have to follow their formula to ensure price continuity, but at the same time they have to keep their prices competitive when compared with other grades in the market." State oil giant […]

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Saudi Arabia to Cut Oil Production After Summer

The world’s top crude-oil exporter, Saudi Arabia, is planning to pull back from record-high levels of production at the end of the summer when domestic energy demand subsides, according to people with knowledge of the matter. The reduction could begin as soon as September and would amount to about 200,000 to 300,000 barrels a day, bringing production to about 10.3 million barrels a day, the people said. Saudi Arabia told the Organization of the Petroleum Exporting Countries that it produced 10.56 million barrels a day in June, a record high. “It is purely based on the [domestic] demand situation,” one of the people said, adding that “production is likely to hover around” 10 million barrels until the end of the year. Saudi Arabia—one of a handful of countries that generates electricity by burning crude oil—generally reduces production in the fall, when demand for the heavily subsidized energy to power […]

Posted On : Published By : Tom Whipple
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Saudi Arabia to Pull Back Production After Summer

RIYADH—The world’s top crude-oil exporter, Saudi Arabia, is planning to pull back from record-high levels of production at the end of the summer when domestic energy demand subsides, according to people with knowledge of the matter. The reduction could begin as soon as September and would amount to about 200,000 to 300,000 barrels a day, bringing production to about 10.3 million barrels a day, the people said. Saudi Arabia told the Organization of the Petroleum Exporting Countries that it produced 10.56 million barrels a day in June, a record high. “It is purely based on the [domestic] demand situation,” one of the people said, adding that “production is likely to hover around” 10 million barrels until the end of the year. Saudi Arabia—one of a handful of countries that generates electricity by burning crude oil—generally reduces production in the fall, when demand for the heavily subsidized energy to power […]

Posted On : Published By : Tom Whipple
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Saudi Arabia Having to Borrow Billions – Could Be Bankrupt by End of the Decade

Over the past year, Saudi Arabia – once among the richest nations on the planet – has wound up having to sell some $4 billion in bonds. It has been necessary in order to maintain levels of spending on public works and continue financing the war against Yemen. The Saudi government has also had to draw on its reserves of foreign currency. Falad al-Mubarak, who heads the Saudi Arabian Monetary Agency (the nation’s equivalent of the U.S. Federal Reserve), predicts “an increase in borrowing” in the face of a projected $130 billion deficit. The primary cause is the drastic decline in the price of crude oil. Since hitting a peak of around $125 in February 2011, the price of a barrel of oil is currently under $50. It’s not going to get better anytime soon. Oil company executives predict it may be years before petroleum prices rebound. In order […]

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Saudi crude oil exports fall to lowest in five months in May

A fisherman pulls in his net as an oil tanker is seen at the port in the northwestern city of Duba April 20, 2013. Picture taken April 20. Saudi Arabia’s crude oil exports fell to their lowest in five months in May despite near record production, as the OPEC kingpin turns itself into a major refined-fuels power and as domestic consumption rises. Saudi Arabia, the world’s top crude oil exporter, shipped 6.935 million barrels per day (bpd) on average in May, down from 7.737 million bpd in April and the lowest since December, official data showed on Sunday. As crude exports slide, the OPEC producer is offering customers millions of barrels of diesel from new refineries as it turns itself into a major supplier of refined oil products, potentially triggering a price war with Asian competitors as its exports feed into a glut. Saudi Arabia’s massive refineries are now […]

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Saudis Cast Net for ISIS Sympathizers

BEIRUT, Lebanon — The security forces in Saudi Arabia have carried out a nationwide dragnet in recent months that resulted in the arrest of more than 400 people believed to be connected to the Islamic State jihadist group, the Saudi Interior Ministry said on Saturday. The people who were arrested were linked to recent attacks inside the kingdom; they planned attacks or monitored potential targets, or used social media to spread extremist ideology and entice new recruits, the Interior Ministry said. The high number of arrests highlights the profound fears inside the conservative, oil-rich kingdom that the jihadists who control territory in nearby Iraq and Syria will sow further trouble inside Saudi Arabia, as the militants’ leaders have vowed to do. While Saudi Arabia’s strict version of Islam shares some aspects with the one espoused by the Islamic State, the kingdom’s leaders have denounced the group for its wanton […]

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King Salman of Saudi Arabia Meets With Hamas Leaders

CAIRO — King Salman of Saudi Arabia met Friday with top political leaders of the Palestinian militant group Hamas , in the most striking example yet of the new king’s willingness to work with Islamist organizations long considered foes. Analysts with close ties to the Saudi royal family said the meeting appeared to reflect King Salman’s determination to rally as much of the Arab world as possible against Iran, the kingdom’s chief rival, at a time when the Saudis fear that Iran will emerge empowered by its deal with Western powers to lift economic sanctions in exchange for limits on its nuclear program . The meeting was held in Mecca and included Khaled Meshal, Hamas ’s political leader who lives in Qatar. It was a startling reversal from the approach of the previous king, Abdullah, who had led a campaign to roll back or eradicate the Muslim Brotherhood and […]

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Car bomb explosion kills one in Saudi capital

A car bomb has exploded at a security checkpoint in the Saudi capital Riyadh, killing the driver and wounding two policemen, the interior ministry said. The blast went off on Thursday when policemen manning the checkpoint on Al-Hair Road stopped the car for a routine control, the official Saudi Press Agency reported, quoting a ministry spokesman. The policemen were taken to hospital and were in a "stable condition", the spokesman said. "The driver blew up the car and killed himself," he was quoted as saying. The Saudi authorities were investigating the explosion, which took place on the last day of the holy Muslim fasting month of Ramadan. Source: Agencies

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Saudi Arabia triggers potential fuel price war by flooding market with diesel

The world’s top crude oil exporter Saudi Arabia has turned itself into a major power of refined fuels, offering customers millions of barrels of diesel and potentially triggering a price war with Asian competitors as its exports feed into a glut. Saudi Arabia, a leading member in the Organisation of Petroleum Exporting Countries (OPEC), already pledged last November to keep crude output high to defend its market share against higher-cost producers. While the strategy has kept crude markets well-supplied and prices low, the Kingdom has seen mixed success in defending its market share as global production remains high despite low prices. Saudi Arabia is now processing more of its crude at home as its massive refineries turn it into the world’s fourth-largest refiner, in a tie with Royal Dutch Shell, that allows the Kingdom to export more fuel products than ever before. Aramco Trading Co, a subsidiary of state […]

Posted On : Published By : Tom Whipple