Saudi Arabia, the world's top crude exporter, will keep shipments to Asian customers unchanged in September versus this month, sticking to its pledge to pump as much as customers want, sources at refiners said on Monday. The kingdom pledged earlier this summer to lift output to its fastest pace in decades to cool prices, although few customers in Asia.
Apart from India's Reliance Industries which is building a new refinery, have confirmed buying extra oil. Instead, most say that the Saudis have continued to supply 100 percent of the volume stipulated under annual contracts, as they have since last November, finding few takers for more oil as refinery profit margins tumble. "We got what we hoped for, the full contracted volumes, " a Japanese source said.
At least three Japanese refiners, two South Korean refiners and a Taiwanese refiner have received notices of full contracted volumes from state-run Saudi Aramco, as they had requested, trade sources with the refiners told Reuters. Saudi Arabia will also keep supply steady in September to European customers, an industry source said on Monday.
Oil traders have been searching for signs of where Saudi Arabia's incremental volumes are headed since the kingdom began raising output several months ago. So far in Asia, only India's giant private refiner Reliance Industries has taken additional Saudi crude, buying 30 percent of the extra barrels pumped in June and July and likely to take more as it prepares to start its new 580,000 bpd plant. The remaining additional crude supplies are seen flowing to buyers in the United States and Europe, one crude trader in Asia said, but the details could not be confirmed.
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