Oil exports from Saudi Arabia tumbled to their lowest point in six months according to the latest Joint Organizations Data Initiative (JODI) published on 20 June 2016.
As reported by Bloomberg, output sent abroad for the world’s biggest crude exporter suffered a monthly fall of 100,000 barrels per day (bpd) to 7.44 million bpd last April. Exports in that month reached their lowest level since the 7.36 million bpd shipped out in October 2015.
The drop in exports occurred despite a rise in oil production of 10.26 million bpd in April versus 10.22 million bpd a month earlier according to the JODI. Nevertheless, production lags behind the record 10.56 million bpd obtained in June 2015.
Several factors can explain the discrepancy behind Saudi Arabia’s oil exports and production, such as the greater domestic demand for energy. JODI figures showed the amount of crude oil burnt to generate power rose from 397,000 bpd in March to 501,000 bpd in April. Additionally, foreign refineries purchased less oil to account for maintenance that typically takes place in April and May prior to the expected summer demand.
This may account for the decline in Saudi crude oil inventories, which dipped to around 290.85 million barrels in April from nearly 296.666 million barrels a month earlier and the peak of 329.43 million barrels in October last year. Related: How The Brexit Vote Will Impact Oil Prices
The JODI also reported a decline in oil exports for several Arabian Peninsula states. Qatari exports last April plummeted to an eleven-year low, while OPEC members Iraq and Kuwait also suffered from lower shipments abroad.
The new data may provide ammunition for senior government officials and royal figures seeking to pivot Saudi Arabia away from relying so much on oil to power its economy. Deputy Crown Prince Mohammed bin Salman is reportedly one of the main proponents of the “Saudi Vision 2030” economic reforms that could more than triple non-oil revenue to about US$141 billion by 2020.
By Erwin Cifuentes for Oilprice.com
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