By May 9, 2017 Read More →

Aramco Asia sales to be cut by about 7 million barrels in June

Saudi Aramco

Saudi Aramco will cut supplies to South East Asia, China and Korea each by one million barrels in June. Photo by AFP/Getty Images photo by Frederic J. Brown. 

Saudi Aramco cuts sales to India by 3 million barrels in June

According to a Reuters report, Saudi Aramco will cut its June sales to Asia by about 7 million barrels, as the world’s largest crude exporter cuts output as part of the OPEC supply cut agreement.

Operating under the OPEC pact, Saudi Arabia has reduced supplies to customers in Europe and the US, but has shielded Asian clients from any supply reductions.

With summer approaching, Aramco is cutting back supplies to Asia to meet domestic demand for power.

This year, officials are expecting an earlier spike in demand as the Muslim fasting month of Ramadan begins earlier in late May.

The cutbacks in supply next month do not mean the kingdom is planning to deepen cuts to Asia for the rest of 2017, according to a Reuters source.

June nomination plans show Aramco will cut supplies to South East Asia, China and Korea each by one million barrels next month, according to a source who did not wish to be identified.

The state-run oil giant is also expected to reduce sales to India by about 3 million barrels and cut sales to Japan by slightly less than one million barrels.

In total, the cuts should amount to between 233,000-234,000 barrels per day (b/d).

This summer, Saudi Arabia is planning to raise energy prices and use more natural gas in power stations in an effort to reduce oil use.  Industry sources say these moves should result in a drop in consumption of about 200,000 b/d.



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