Saudi to restore full oil output by next week

Saudi Arabia has restored more than 75 per cent of crude output lost after attacks on its facilities and will return to full volumes by early next week, a source briefed on the latest developments yesterday. Saudi’s oil production from its Khurais plant is now at more than 1.3 million barrels per day, while current production from its Abqaiq plant is at about 3 million bpd, the source said. 

The Sept. 14 attacks on the Abqaiq and Khurais plants, some of the kingdom’s biggest, caused raging fires and significant damage that halved the crude output of the world’s top oil exporter, by shutting down 5.7 million barrels per day of production. Saudi Energy Minister Prince Abdulaziz bin Salman and the chief executive of state oil company Aramco, Amin Nasser, have said the output will be fully back online by the end of September.

The kingdom has managed to recover supplies to customers to the levels they were at prior to the attacks by drawing from its huge oil inventories and offering other crude grades from other fields, Saudi officials said. No casualties were reported at the sites even though thousands of workers and contractors work and live in the area. Saudi said it would ensure full oil supply commitments to its customers.

The kingdom ships more than 7 million bpd to global destinations every day, and for years has served as the supplier of last resort to markets. Saudi Arabia’s ability to quickly restore oil production after the attacks, which hit at the heart of the Saudi energy industry, would demonstrate an important degree of resilience to potentially very damaging shocks, Moody’s said last week. Aramco has a meeting with analysts scheduled today at the company’s headquarters in Dhahran, two sources said.

Europe gasoline exports to Mideast surge

Over 400,000 tonnes of gasoline and gasoline blending components have been booked in the past week for loading between Sept. 21 and Sept 26 out of northwest Europe with Mideast Gulf delivery options, shipping data shows. The flow is the equivalent of around 500,000 barrels per day. It is unclear where the cargoes will end up, but traders said that Saudi Arabia’s state-run oil company Aramco is seeking to buy large volumes of refined oil products.

Europe’s exports of gasoline and blending components to Saudi Arabia averaged 60,000 bpd in the first five months of the year, according to data analytics firm Vortexa. “A flurry of gasoline bookings that emerged this week for Europe to Middle East voyages could see more European gasoline make its way to Saudi Arabia,” Vortexa said in a note.

Traders said the rise in shipping bookings was related to a sharp increase in demand following attacks on Saudi Arabia’s oil infrastructure on Sept. 14, which knocked out around 1 million bpd of Saudi Arabia’s refining capacity.