UAE's ADNOC reinstates full oil supplies in Dec as OPEC+ boost output

SINGAPORE: Abu Dhabi National Oil Company (ADNOC) planned to supply full volumes of all crude grades to term customers in Asia in December, several sources with knowledge of the matter said on Monday.

The crude grades include Murban, Umm Lulu, Das and Upper Zakum, the sources said.

The United Arab Emirates producer exports the bulk of its crude to Asia.

This will be the first time since the oil price crash in the second quarter last year when the COVID-19 pandemic ravaged demand that ADNOC did not implement any supply cut. they said.

The allocation cuts were in compliance with production quotas by the Organization of the Petroleum Exporting Countries and its allies including Russia, a group known as OPEC+, to support prices.

Global Brent crude futures have gained nearly 60% since the start of the year to hit a near three-year high on Monday, supported by tighter supplies from OPEC+ and a global recovery in fuel demand from pandemic.

Buyers had been expecting ADNOC to reinstate full supply volumes from December, as OPEC+ agreed in July to increase production by 400,000 barrels per day between August and December.

The rise in supplies has weighed on ICE Murban crude futures' premium to Dubai quotes this month, averaging at about $1.50 a barrel, down from last month's average of $2.20, Reuters data showed.

ADNOC had told customers last month that it will reduce term crude supplies in November by 5%.

The producer could not be immediately reached for a comment outside of office hours.