Saudi Aramco, the world's largest oil exporter, has offered additional crude supplies to customers in Asia and Europe, according to reports originating in European and Asian refineries.
The news comes as OPEC announces that it will achieve US$1 trillion in revenues for the first time this year, benefiting from high prices that may cause a double dip recession.
The national oil company of Saudi Arabia offered extra cargoes for delivery later this year, stated unofficial reports from companies based in India, South Korea, Taiwan, China and Europe.
OPEC failed to reach a consensus on a Saudi Arabian proposal to raise output at a June 8 meeting as oil traded at approximately US$ 100 per barrel in New York. Saudi Arabia, together with Kuwait, Qatar and the United Arab Emirates, proposed increasing production by 1.5 million barrels per day at the meeting in Vienna. However, members including Libya, Angola, Ecuador, Algeria, Iran and Venezuela blocked these proposals.
A Saudi industry official with knowledge of the matter said on June 10 that Aramco would pump more crude oil, though it is too early to say by how much.
Middle East producers have boosted production to replace a cut in supplies from Libya after fighting between anti government forces and troops loyal to leader Muammar Qaddafi reduced exports from the North African state.
The crude oil and fuel infrastructure within Libya was further damaged on June 13 as shelling from Muammar Gaddafi's forces damaged an oil refinery in the insurgent stronghold of Misrata, disrupting fuel supply lines. During the attacks, six rockets hit generators at the complex, leaving them heavily damaged. An engineer on site said it was unclear how long it would take to repair.
Meanwhile, the Prime Minister of Iraq, another OPEC member, has ordered the army to boost protection of the country’s pipelines and refineries from sabotage.
Violence has intensified in Iraq amid a political deadlock before the planned withdrawal of US troops by the end of the year. The attacks have targeted pipelines and refineries, as well as other essential infrastructure.
Output from the 250 000 bpd Baiji refinery, which is Iraq’s largest, was disrupted for several days after an attack on Feb. 26, while a pipeline carrying Iraqi oil from the northern Kirkuk fields to the Turkish Mediterranean port of Ceyhan was damaged by an explosion in March, knocking out as much as a quarter of crude exports for a few days.
Iraq is home to the world’s fifth biggest oil reserves, is struggling to boost energy production and exports after years of conflict, economic sanctions and sabotage.
The price of crude remains hovering at approximately US$ 100 per barrel, as OPEC’s disarray conspires with increased demand from a steadily recovering global economy to push up prices.