Gulf Arab States Cut Oil Sales Under Riyadh Pack
Dubai, Mar 24 (Reuters) - Gulf Arab oil producers took the first steps on Tues. to remove more than 600,000 barrels per day of crude from the world markets in a bid to hike prices.
OPEC states Kuwait and United Arab Emirates announced sales cuts to customers while kingpin Saudi Arabia indicated it was starting to claw back supplies.
These cut backs were the first hard evidence that a producers' pact hammered out in Riyadh on Mar. 22 involving 16 countries had teeth, oil industry analysts said.
The Riyadh pact - orchestrated by OPEC members and non OPEC Mexico- was a reaction to a slump in oil prices that reached nine-year lows. Oil prices have gained more than $1.50 a barrel since the deal was hatched.
Gulf states SA, Kuwait, the UAE, Qatar, Oman together with non-Arab Iran have announced they will cut flows by a total of 750,000, one % of world supplies.
The UAE was among the first to carry out its decision to cut its 2.3 mil bpd of oil output by 125,000 bpd.
The state-owned Abu Dhabi National Oil company informed all its customers on Tuesday that it will cut exports by 5% for liftings in April and May.
It's a cut to all customers, there is no exception" said one Gulf-based trader.
The UAE is Japan's main source of oil, supplying 1.34 mil bpd in Feb., according to MITI.
State owned Kuwait Petr. has stopped all oil sales outside its main term contracts in the so-called "spot market" to meet its pledged cut of 125,000.
KPC is rejecting all requests for spot sales, said one regular customer of the country's crude.
SA was also trimming its spot sales in the market to meet its promised cut of 300.000.
Iran, the worlds third largest exporter has said it will cut 140,000 from its OPEC quota of 3.9 M Industry sources estimate that Iran is already producint more than 140,000 below its quota because of production problems at its fields.
OPEC member Qatar announced that it would cut 30,000 from its current production from April 1 in line with the OPEC accord.
Industry sources estimate that Qatar is prod. around 680,000 compared to its OPEC quota of 413,000.
Non-OPEC Oman has also pledged to cut output by 30,000.
If any one has a FAX number for CNBC, I will mail those guys a copy. Would be curious to see if it changes their slant of things.
Lois |
