DUBAI: Saudi Arabia is experiencing unprecedented demand for its crude oil, especially in Asia, as global energy prices fall and supplies are ramped up.
A source at Saudi Aramco, the world’s biggest oil company, told Arab News that the new pricing and supply arrangements — unveiled in the wake of the end of the OPEC+ agreement in Vienna last week — had been a big success with customers, especially in China and India.
Some customers missed out on bargains in the crude trade simply because of the high levels of demand.
Some European and Asian customers were waiting to hear whether Aramco could meet their orders.
“Basically the demand has been huge and we’re unable to meet it all. It was well over 13 million barrels per day for April supply,” the source said on condition of anonymity.
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This week, Aramco announced plans to increase its maximum supply capacity to 13 million barrels per day by expanding and enhancing existing reserves, but currently the limit is 12.3 million, making the Kingdom the biggest producer in the world.
Global crude prices suffered their biggest falls in 30 years after Russia declined to extend the cuts in output that have kept oil at a relatively high level for the past three years.
Brent crude — the Middle East benchmark — was trading at $33.71 in New York, down nearly 6 percent, after big falls for most of last week.
Financial markets continued to suffer on fears of the economic repercussions from the coronavirus outbreak, categorized as a “pandemic” by the World Health Organization.
The S&P 500 Index was suspended on opening on Wall Street because of volatility. By mid-morning, it was down more than 3 percent.