Oil and Gas

UPDATE 1-Saudi Arabia's oil exports top 10 mln bpd from May -ministry

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DUBAI, March 17 (Reuters) - Saudi Arabia, the world’s top oil exporter, plans to boost its crude oil exports to more than 10 million barrels per day from May while burning less crude for power generation, the energy ministry said on Tuesday.

“Saudi Arabia will utilise the gas produced by the Fadhili gas plant to compensate for around 250,000 barrels per day (bpd) of domestic oil consumption,” the ministry said in a statement.

The “will enable the kingdom to increase its crude exports during the coming few months to exceed 10 million bpd,” it said.

The ministry did not say how much crude will Saudi Arabia export in April, when it has said it plans to raise its oil supply to a record 12.3 million bpd.

The plan is another indication that the kingdom is willing to carry on with its survival-of-the-fittest oil strategy, by using its vast oil supply - Riyadh produces more than a tenth of global crude - and its financial muscle to drive out higher cost rivals.

On Monday, Saudi Aramco said it is likely to sustain higher oil output planned for April in May, and that it was “very comfortable” with $30 a barrel price, signalling the state oil company is prepared to live with low prices for a while.

Saudi Arabia said last week it would launch a programme to boost production capacity for the first time in more than a decade, signalling to Russia and other rivals it was ready for a long battle over market share.

Oil has fallen by more than 40% to less than $30 a barrel since talks between OPEC and non-OPEC producers on March 6 collapsed without a deal to deepen or extend output cuts that had been in effect since January 2017.

Saudi Arabia, OPEC’s de facto leader, wanted a deeper output cut to support prices, which had been hit by the coronavirus pandemic, but Russia refused to agree to further reductions. (Reporting by Rania El Gamal, editing by Louise Heavens)