Three factors that will boost Saudi Arabia's oil output.
RyYAD (CyHAN)- Analysts of the US JP Morgan bank expect Saudi Arabian oil output to increase to 10.2 million barrels per day in 2015, up 0.5 million barrels per day year over year.
Saudi Arabia is the largest OPEC member producer.
"The rapid increase in Saudi Arabian production in recent months has prompted a fair degree of skepticism over its sustainability and the potential for higher volumes to weigh on prices," analysts said in a report, obtained by Trend.
Analysts mentioned with the reference to Saudi Arabia's official estimate, that the country's crude output in March stood at 10.3 million barrels per day, up 0.7 million barrels per day mom (Month-over-Month).
This represents the highest monthly output in at least 20 years.
Analysts see three factors contributing to the rise in Saudi crude output.
First, analysts estimate that country's exports could average 7.3 to 7.4 million barrels per day this year, on the back of surging Asian refinery demand.
Second, with the commissioning of the second JV Export refinery crude runs are expected to average 2.3 million barrels per day, up 0.3 million yoy (year-over-year).
"Higher runs will likely contribute higher fuel oil output on the margin, as the new refinery's upgrading units are slowly brought to full operating rates later in the year," analysts said.
Third, analysts see increased availability of fuel oil from the refineries as meeting much of the call for higher power demand within Saudi Arabia this year.
JP Morgan analysts see potential for Saudi crude exports to average 7.4 million barrels per day in 2015, a substantial pick up from the low point of 6.7 million barrels per day in August 2014.
Saudi Arabian crude exports have decreased significantly in the US, according to the analysts. They expect the exports to average near 800,000 barrels per day in the coming months. Exports to Asia may be close to current strong levels, analysts believe.
OPEC oil supply reached 30.63 million barrels per day in March, which was the highest level since October. Saudi Arabia's oil production amounted to 10.01 million barrels per day last month compared to 9.663 million barrels per day in February, according to OPEC's latest oil market report.
Oil demand in Asia is strong and Saudi Arabia is ready to supply any more crude needed, Reuters reported citing the country's oil minister Ali al-Naimi.
The minister also said that Saudi Arabian oil output would probably remain about 10 million barrels per day. (Cihan/Trend az)
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|Publication:||Cihan News Agency (CNA)|
|Date:||May 5, 2015|
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