• 3 minutes e-car sales collapse
  • 6 minutes America Is Exceptional in Its Political Divide
  • 11 minutes Perovskites, a ‘dirt cheap’ alternative to silicon, just got a lot more efficient
  • 48 mins GREEN NEW DEAL = BLIZZARD OF LIES
  • 17 mins Could Someone Give Me Insights on the Future of Renewable Energy?
  • 36 mins How Far Have We Really Gotten With Alternative Energy
  • 19 hours "What’s In Store For Europe In 2023?" By the CIA (aka RFE/RL as a ruse to deceive readers)
  • 1 day Bankruptcy in the Industry
  • 2 days The United States produced more crude oil than any nation, at any time.
Suing Big Oil Is Becoming a Lucrative Business

Suing Big Oil Is Becoming a Lucrative Business

Supermajors have been a top…

Oil Fund Withdrawals Suggest Extended Price Rally

Oil Fund Withdrawals Suggest Extended Price Rally

Investors are ditching the oil…

Big Oil’s Carbon Capture Conundrum

Big Oil’s Carbon Capture Conundrum

Energy experts and environmentalists express…

Dave Forest

Dave Forest

Dave is Managing Geologist of the Pierce Points Daily E-Letter.

More Info

Premium Content

Russia Makes A Move On Asian Oil Markets As OPEC Cuts

Transneft train

Oil prices have been struggling to rise beyond the low $50s per barrel. Not helped by news this week that Libya’s production has hit a 3-year high at 715,000 barrels per day — and is expected to rise to 1.25 million b/d by end-2017.

And the crude market may have an even bigger problem looming.

Russia.

New data Monday showed that Russian oil producers achieved a major milestone in 2016. Becoming the largest supplier of crude to energy-hungry China.

That came as Russian oil shipments to China rose 24% as compared to 2015 levels — to an average 1.05 million barrels per day for the year. Inching Russia ahead of go-to supplier Saudi Arabia, which saw its exports to China average 1.02 million b/d in 2016.

That shift is happening as Saudi producers reportedly reigned in output under the OPEC production cuts agreed in late 2016. A move that likely played a big role in Saudi Arabia’s China exports staying flat in 2016 — despite overall Chinese demand for foreign oil hitting its highest level since 2010 during the year.

The chart below shows the story well.

(Click to enlarge)

China’s crude imports from Russia (white line) saw another big jump in 2016, while Saudi exports (blue) were flat

All of which suggests that Russia is shaping up as major challenge to OPEC dominance in the global oil market. With this world-leading producer being free from production quotas — allowing it to grab market share while big OPEC producers like Saudi Arabia cut back output.

That’s going to put pressure on OPEC to get back to business in pumping more oil. Which would in turn weigh on the oil price — especially as former big producing nations like Libya make a return to the market.

Watch for more import stats from China to see if Russia can hold its spot as top supplier. And for signs of dissent amongst OPEC members — who may be realizing the U.S. shale oil isn’t their only competitor globally.

ADVERTISEMENT

Here’s to being on top.

By Dave Forest

More Top Reads From Oilprice.com:


Download The Free Oilprice App Today

Back to homepage





Leave a comment
  • Bob on January 26 2017 said:
    Correction: Russia accepted quotas and has cut back production. Check it out. You're citing '16 figures.

Leave a comment




EXXON Mobil -0.35
Open57.81 Trading Vol.6.96M Previous Vol.241.7B
BUY 57.15
Sell 57.00
Oilprice - The No. 1 Source for Oil & Energy News