Saudi Arabia boosted oil exports in 2015 as the world’s largest crude shipper ended its first year of a plan to defend market share with global supplies on the rise.
Crude exports averaged 7.39mn bpd last year, 4% higher than 7.11mn bpd a year earlier, according to data compiled by Bloomberg from the Joint Organisations Data Initiative. Shipments in December were 7.5mn bpd compared with 7.7mn barrels in November, JODI data released on Thursday showed.
Saudi Arabia led the Organization of Petroleum Exporting Countries in November 2014 to refrain from cutting production to boost prices in the face of growing supplies from the US to Canada and Russia. With Brent close to 12-year lows, Saudi Arabia and Russia offered last week to freeze output near record levels as long as others follow suit.
“The customers who stockpiled crude oil were the ones who benefited the most from the Saudi policy to maintain its market share,” Mohammed Ramady, London-based independent analyst, said by phone on Thursday. “They filled their storage with cheaper Saudi crude.”
Production was 10.1mn bpd in December, staying above 10mn barrels for a 10th consecutive month, the JODI data show. Since November 2014, Saudi Arabia’s production climbed 5.6% as exports advanced 2.6%.
Saudi Arabia’s exports hit 7.9mn bpd in March, the highest since November 2005. “We don’t want a reduction in supply,” Saudi Oil Minister Ali Al-Naimi told reporters in Doha in announcing the agreement with Russia, Qatar and Venezuela. “We want to meet demand.”
Global oil demand last year was very high and “exceptional” as low oil prices boosted demand from transportation and petrochemical industries in the US, China and elsewhere in Asia, Opec said in its February monthly report. Oil consumption grew 1.54mn bpd last year, the second-fastest pace in the past 10 years, it said. Growth is seen slowing to 1.25mn bpd this year, Opec said.
“In 2016, the Saudis realized that demand will not be as high as 2015 especially from China,” Ramady said. “This explains the shift in policy this week to freeze production and thus limiting the amount of crude they will sell to the international oil market.”