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U.S. Begins Importing Iraqi Oil After Saudis Cut Exports

Oil Barrels

The United States has begun importing Iraqi oil at a rate of 1.1 million barrels per day to replace export cuts announced by Saudi Arabia late last month, new figures compiled by Bloomberg show.

New data from the Department of Energy suggests that during the first week of June, Iraqi oil entered the U.S. at the quickest rate in the past five years – marking the first time the nation’s exports exceeded those from Saudi Arabia over the same time period.

In late May, Riyadh announced its plans to purposely reduce exports to the United States to force a reduction in the latter’s sizeable inventories, which are preventing a greater rise in global oil prices, according to Saudi Oil Minister Khalid Al-Falih.

Earlier that same month, Saudi Aramco said it would cut crude supplies to China, South Korea, and South East Asia by 1 million barrels each. The nations exports to Indian buyers in June were set to decline by just over 3 million barrels, and supplies to Japan will drop by just under 1 million barrels this month, according to a Reuters’ source.

The Organization of Petroleum Exporting Countries’ (OPEC) deal to reduce production does not set limits on the amount any member country can export to its customers. This is why Saudi cargoes to the U.S. in recent months have totaled 1.21 million barrels a day – the highest rates since 2014, the year of the oil price crash.

As the de facto leader and largest producer of OPEC, Saudi Arabia has cut its production the most of any member of the bloc. But stubbornly high fossil fuel inventories - which have been maintained worldwide, but are most readily measured in the U.S. due to open customs data – have prevented the measures from buttressing oil prices in a lasting way. Importer nations have opted to take advantage of low oil prices to stock up for the future.

By Zainab Calcuttawala for Oilprice.com

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  • EH on June 08 2017 said:
    So tell me, heck, be honest here for once in45 years with us USA capitalist consuming public,, you know us, the ones who foot the bill for public lands, the Military, do the physical labor in the mines,fields, factories and fields. The very ones with the technology visions to make this country work, move forward and send our children off to war to be injured or even killed. WHY ARE WE BUYING IMPORTED OIL,, ? Oh, that's right I forgot, it's NOT foreign Oil,, ITS OUR OIL THAT WAS MOVED DOWN THE XL PIPELINE, LOADED ON BARGES IN THE GULF, SHIPPED ROUND THE WORLD, And brought back to port and sold to us as foreign at inflated prices.

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