RIYADH: Saudi Arabia’s crude output increased to 8.94 million barrels per day in July, reflecting a 1.26 percent rise from June.
However, crude exports fell to 5.74 million bpd, a decrease of 5.06 percent, data released by the Joint Organizations Data Initiative showed.
Domestic petroleum demand saw an uptick, rising by 79,000 bpd to reach 2.83 million bpd. During a virtual OPEC+ meeting on Sept. 5, member countries reiterated their commitment to previously announced voluntary production cuts made in April and November 2023, emphasizing adherence to the agreed adjustments.
The eight OPEC+ nations—Saudi Arabia, Russia, Iraq, the UAE, Kuwait, Kazakhstan, Algeria, and Oman—reaffirmed their commitment to production cuts, with Iraq and Kazakhstan promising to follow the compensation schedules they submitted to the OPEC Secretariat after the April meeting.
Data revealed that refinery crude exports dropped by 17 percent to 1.13 million bpd. The main products included processed crude used for diesel, motor and aviation gasoline, and fuel oil. Notably, diesel accounted for 43 percent of refined product exports, while motor and aviation gasoline made up 30 percent, and fuel oil comprised 8 percent. Despite its smaller share, fuel oil shipments surged by 20 percent, reaching 343,000 bpd.
In July, Saudi Arabia’s refinery oil products output reached 2.46 million bpd, down 2 percent from the previous month. Diesel accounted for the largest share at 44 percent, followed by motor and aviation gasoline at 28 percent, and fuel oil at 17 percent.
According to TechSci Research, the Kingdom’s oil refining market was valued at $27 billion in 2023 and is projected to grow at a compound annual growth rate of 4.7 percent through 2029. The refining sector is vital to Saudi Arabia’s energy landscape, supported by significant investments aimed at expanding refining capacity and integrating advanced technologies.
As global demand for refined products—such as gasoline, diesel, jet fuel, and petrochemical feedstocks—continues to rise, Saudi Arabia is actively modernizing its infrastructure and building new refineries. These strategic advancements are essential for maintaining the Kingdom’s position as a leading global producer of refined petroleum products, catering to the growing needs of transportation and industrial sectors worldwide.
Direct crude usage
Saudi Arabia’s direct burn of crude oil rose significantly, increasing by 211,000 bpd to a total of 769,000 bpd. This marks a substantial 37.8 percent rise compared to the previous month. Year-over-year, direct crude usage was up by 177,000 bpd, reflecting a 30 percent increase.
This surge in direct crude utilization is likely fueled by rising energy demands linked to population growth and an influx of newcomers to the country. It highlights both increased domestic consumption and the ongoing development of residential and business sectors, which contribute to the growing energy needs in Saudi Arabia.
To address peak summer electricity demand, Saudi Arabia imported fuel oil from Kuwait in July for the first time in over two years, as reported by Oil & Gas News. This decision was prompted by a decline in discounted fuel supplies from Russia, leading the Kingdom to seek alternative energy sources to ensure a stable power supply during the hottest months.
