A report showing a fifth weekly fall in the USA oil rig count also underpinned crude prices, although trading was thin with China away on holiday.
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The world’s largest producer is determined to keep prices low in order to cripple non-OPEC competition.
To be sure, the comparison of crude exports with estimated global product demand is not ideal, but it provides a rough indication of the changes in Saudi market share using publicly available and up to date data.
The OSPs probably didn’t decline by as much as indicated by the contango because they hadn’t risen by as much in the third quarter, when the contango virtually disappeared amid strong demand for prompt supplies.
He believes Saudi Arabia, which is the largest oil producer and exported within OPEC, is now trying to eliminate unconventional oil production seen in hydraulic fracturing through overproduction.
At that meeting, Russian Federation refused to cut its own production in a bid to support prices – somewhat understandably given that OPEC itself has maintained record production levels. The IEA expects world demand in Y 2015 to grow by 1.71-M BPD, a 5-year high, and together with other forecasters sees slower non-OPEC supply growth.
But Moscow is now prepared to meet OPEC and non-OPEC oil producers to discuss oil markets if such a meeting is called, its energy minister said Saturday.
Nonetheless, the uptrend in 2015 may provide a few comfort to Saudi oil officials, who according to two industry sources were alarmed when Saudi crude exports to the US fell below one million bpd in August 2014. The cut was smaller than the median estimate of a $1.90 a-barrel reduction expected by seven refiners and traders in Asia surveyed by Bloomberg last week. Medium crude will sell at a discount of 85 cents a barrel to the regional benchmark, the widest since March.
In a measure of the uncertainty surrounding consumption, the gap between the highest and lowest forecasts is equivalent to 0.5 million bpd, 30-40 percent of the entire projected increase in demand.
Shipments in the first half of 2015 to European members of the Organization for Economic Cooperation and Development (OECD) were the highest since 2006 averaged at 4,153 kilotonnes per month, or about 1.01 million bpd, according to a Reuters analysis of global Energy Agency data.
OPEC last met this summer in Vienna, when it agreed to leave its production ceiling unchanged at 30 million barrels per day.
Middle Eastern producers are competing increasingly with cargoes from Latin America, North Africa and Russian Federation for buyers in Asia.
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Russia’s economy has not only been hit hard with the fall in oil price.
