Saudi Arabia continued to slash its oil exports as this year progressed, with February crude shipments dropping by 227,000 bpd from January to just below 7 million bpd, as the Kingdom is determined to rebalance the market in its effort to support oil prices.
According to data released on Thursday by the Joint Organisations Data Initiative (JODI) database, which collects self-reported figures from 114 countries, Saudi Arabia's crude oil exports stood at 6.977 million bpd in February, compared to 7.254 million bpd in January and to 7.687 million bpd in December 2018, when the Kingdom started to aggressively cut oil supply to prevent another glut.
Total Saudi crude oil and oil products exports dropped by 432,000 bpd from January to 8.44 million bpd in February 2019, according to JODI's data.
The figures by JODI, as well as OPEC's production numbers, show that Saudi Arabia is keeping its pledge to drastically reduce oil supply to the market and to over-deliver in its share of the OPEC+ production cuts.
In an interview with the Financial Times in February, Saudi Energy Minister Khalid al-Falih said that the Saudis would cut production tos around 9.8 million bpd in March, some 500,000 bpd below the commitment in the OPEC+ deal. Al-Falih also said that Saudi Arabia would be cutting its crude oil exports to near 6.9 million bpd in March, slashed from the November high of 8.2 million bpd.
Related: Oil Could Fall To $40 If OPEC Abandons Its Deal
In early March, Saudi Arabia signaled that it is determined to do 'whatever it takes' to rebalance the market by keeping its April crude oil exports at below 7 million bpd, despite requests for more than 7.6 million bpd of Saudi oil from its customers. The lower allocations by Saudi Aramco for April will also mean that the Kingdom's oil production will be "well below 10 million bpd" in April, a Saudi official told Reuters.
Saudi Arabia, OPEC's largest producer and de facto leader, has been signaling that it would do whatever it takes to rebalance the market (and support oil prices), and followed through on its commitment to cut much deeper than pledged in the pact, as OPEC's March production dipped to a four-year low.
By Tsvetana Paraskova for Oilprice.com
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Comments
Moreover, Saudi Arabia is also telling President Trump that it will not be conned again by him to raise its oil production to keep oil prices in the lower sixties and that it will retaliate if he ever tries to sue Saudi-led OPEC for an alleged oil price manipulation and cartel-like practices under the NOPEC legislation currently under discussion by the US Congress.
Dr Mamdouh G Salameh
International Oil Economist
Visiting Professor of Energy Economics at ESCP Europe Business School, London