Saudi Arabia is moving away from its strategy to expand oil sales in the Asian markets. The country now begins to give way to its competitors in a hope of further price increases. Reuters analysts made such a conclusion basing on data on energy resources import in the major countries of South and East Asia.
In the first five months of this year (from January to May 2016), import of Saudi oil to China reached an average of 1.05 million barrels per day. In 2015, increase over the same period amounted to 3.9%. As a whole, China's oil imports over the period increased by 16.5%. In particular, in January-May 2016 Russia overtook Saudi Arabia having become a leading supplier of oil to China. Russian imports amounted to 1.06 million barrels per day (42% growth compared to last year).
There was a similar situation in India; only here Riyadh’s competitors are not Russia, but Iran and Iraq. In January-May 2016, India imported oil from Saudi Arabia with an average speed of 856 th. barrels per day (9.4% growth compared to January-May 2015). The increase in purchases from Iran between the aforesaid periods soared by 64.5% to 334 thousand barrels per day, and from Iraq - by 55% to 892 thousand barrels. Baghdad thereby outflanked Riyadh in the struggle for leadership in the Indian oil market.
Saudi Arabia still continues to be a leading supplier of Japan with 1.25 million barrels per day. Growth in January-May 2016 compared to the same period in 2015 amounted to 12.6%. For its part, Iraq increased its oil supply to Japan by 51%, although the volume remains low in real terms - less than 72 thousand barrels per day.
Finally, South Korea (the fourth largest Asia-Pacific oil consumer) bought 7% less of Saudi oil than last year, even though Riyadh is the country's leading supplier. On the contrary, Iran has increased its oil exports to the Republic of Korea twice. In June, the volume amounted to 200 th. barrels daily.
"Despite the overproduction of oil and low prices, countries such as Saudi Arabia hold attention. Because of their strategic importance, they are expected to return the balance of supply and demand as soon as market conditions improve", - said last week Head of the Ministry of Energy of Saudi Arabia Khalid al-Falih.
According to Reuters, data on trade with the country’s Asian partners show that Saudi Arabia has already started to prepare for rebalancing of markets, moving away from the previous plan to maintain its market share by any means. June increase in the minimum prices for its crude Arab Light may be another proof to the suggestion.
"The situation around the minimum price may be indicative of Riyadh’s paradigm shift: now they are even willing to give up a small piece of the market to competitors, expectating that the market is already on its way to the balance, and oil prices will soon increase significantly," - the newspaper notes.
source: reuters.com
In the first five months of this year (from January to May 2016), import of Saudi oil to China reached an average of 1.05 million barrels per day. In 2015, increase over the same period amounted to 3.9%. As a whole, China's oil imports over the period increased by 16.5%. In particular, in January-May 2016 Russia overtook Saudi Arabia having become a leading supplier of oil to China. Russian imports amounted to 1.06 million barrels per day (42% growth compared to last year).
There was a similar situation in India; only here Riyadh’s competitors are not Russia, but Iran and Iraq. In January-May 2016, India imported oil from Saudi Arabia with an average speed of 856 th. barrels per day (9.4% growth compared to January-May 2015). The increase in purchases from Iran between the aforesaid periods soared by 64.5% to 334 thousand barrels per day, and from Iraq - by 55% to 892 thousand barrels. Baghdad thereby outflanked Riyadh in the struggle for leadership in the Indian oil market.
Saudi Arabia still continues to be a leading supplier of Japan with 1.25 million barrels per day. Growth in January-May 2016 compared to the same period in 2015 amounted to 12.6%. For its part, Iraq increased its oil supply to Japan by 51%, although the volume remains low in real terms - less than 72 thousand barrels per day.
Finally, South Korea (the fourth largest Asia-Pacific oil consumer) bought 7% less of Saudi oil than last year, even though Riyadh is the country's leading supplier. On the contrary, Iran has increased its oil exports to the Republic of Korea twice. In June, the volume amounted to 200 th. barrels daily.
"Despite the overproduction of oil and low prices, countries such as Saudi Arabia hold attention. Because of their strategic importance, they are expected to return the balance of supply and demand as soon as market conditions improve", - said last week Head of the Ministry of Energy of Saudi Arabia Khalid al-Falih.
According to Reuters, data on trade with the country’s Asian partners show that Saudi Arabia has already started to prepare for rebalancing of markets, moving away from the previous plan to maintain its market share by any means. June increase in the minimum prices for its crude Arab Light may be another proof to the suggestion.
"The situation around the minimum price may be indicative of Riyadh’s paradigm shift: now they are even willing to give up a small piece of the market to competitors, expectating that the market is already on its way to the balance, and oil prices will soon increase significantly," - the newspaper notes.
source: reuters.com