Top world crude exporter Saudi Arabia will continue to enforce its Opec oil cut in full through the end of the year, but will ship more to some refiners in its main Asian market next month, sources said on Monday.
That suggests the United States and Europe may bear the brunt of Riyadh's cut as part of a 1.2 million barrels per day (bpd) Opec reduction that began November 1. "Saudi Arabia is already cutting by its full amount and will continue to do so in November and December," said a Gulf source familiar with the kingdom's oil policy.
Riyadh is to cut 380,000 bpd, shouldering the bulk of the Opec deal. State oil company Saudi Aramco can distribute the reduction as it sees fit and does not have to lower exports across the board.
December showed a surprising rebound to some customers in Asia, which takes nearly half the kingdom's exports, industry sources said. Saudi Arabia's crude supplies to Europe will remain steady versus November, however, trade sources said. "Since they reap such huge price rewards going East, why not maximise liftings there and shave the West?" said a senior crude oil trader.
Two refiners in Japan were notified by state firm Aramco it would supply them about 4-5 percent less crude than stipulated under their annual contract next month, a shallower cut than November's 7-8 percent reduction, industry sources said.
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