Saudi Arabia’s Crude Production and Exports Show Mixed Trends in January
In a recent study, it was found that Saudi Arabia’s crude production increased by 12,000 barrels per day in January, reaching 8.96 million bpd. This represents a 0.22 percent monthly rise. However, the Kingdom’s crude exports in January declined by 11,000 bpd to 6.29 mbpd, marking a 0.17 percent dip compared to December.
Reasons Behind Saudi Arabia’s Decline in Crude Exports
The decline in Saudi Arabia’s crude exports can be attributed to the Kingdom’s decision to reduce oil output in accordance with an agreement by OPEC+ to maintain market stability. Saudi Arabia had initially reduced oil output by 500,000 bpd in April 2023, a measure that has been extended until the end of December 2024. Additionally, the Kingdom implemented an extra oil output cut of 1 million bpd in July, which continued until the end of December 2023.
Saudi Arabia’s Strategies to Manage Oil Production
To further align with market demands, the Saudi government instructed Saudi Aramco to halt its oil capacity expansion plan, aiming for a maximum sustained production capacity of 12 million bpd. This target is 1 million bpd below the previous goal set in 2020.
Other Notable Findings in the Study
While Saudi Arabia’s direct burn of crude saw a slight increase of 5,000 bpd in January, the country’s product inventories fell by 3 million barrels. On the other hand, crude inventories rose by 2.6 million barrels during the same period.
The study also highlighted a decrease in crude production in the US by 321,000 bpd to 12.9 million bpd in January. Similarly, US crude exports declined by 386,000 bpd to 4.14 million bpd. Additionally, US crude imports saw a decrease of 74,000 bpd in January.
India, on the other hand, saw a rise in crude imports by 367,000 bpd in January, reaching the second-highest level on record. India’s total product demand also increased by 8,000 bpd month-on-month in January to a 10-month high.
Meanwhile, Japan experienced a decline in crude imports by 270,000 bpd in January, with the country’s product demand dropping by 312,000 bpd to a five-year low.