Saudi Arabia plans to export 7.1 million barrels of crude daily next month, substantially more than what it said it would ship abroad from August this year on, a spokesman for the Energy Ministry of the Kingdom said in a statement.
Still, the statement read, the November allocations were below demand from clients, which came in at 7.711 million bpd. Riyadh, committed to the OPEC oil production cut deal, would not respond to this full demand.
In September, the Kingdom shipped "below 6.7 million bpd," the statement read, which is higher than its August target of 6.6 million bpd. For October, state energy giant Aramco said it cut international allocations by 350,000 bpd, presumably from its September levels.
The 7.1 million bpd export level for November is a significant increase from the 6.6 million bpd self-imposed cap in August.
The higher exports expected in November are in line with seasonal expectations. The Kingdom can now more easily respond to this demand despite production cuts, as the end of summer season, and the resulting lower domestic demand, frees up more crude for exports. The summer is peak oil demand season in the Middle East.
Saudi Arabia, OPEC's de facto leader and pace-setter in the output cut agreement, pledged to cut 486,000 bpd from its daily output from a reference level of 10.544 million bpd. The Kingdom outdid itself in a bid to motivate the rest of OPEC's members to stick to their quotas, at one point announcing production of below 10 million bpd.
OPEC is meeting on November 30 in Vienna to discuss how to proceed with the agreement. Earlier this week, the cartel's head, Mohammed Barkindo, said that OPEC may have to resort to "extraordinary measures" to rebalance the oil market, without going into any detail about what these measures might involve.
By Irina Slav for Oilprice.com
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