Saudi Arabia's ability to avert a global oil supply crunch will only become...
LONDON - Saudi Arabia’s ability to avert a global oil supply crunch will only become clear in a few weeks, because for now its crude held in storage can fill the gap and mask the scale of damage to its facilities, traders and analysts say.
But traders and analysts are skeptical repairs to the Abqaiq and Khurais sites will be swift, while the lack of transparency about Saudi inventories adds to uncertainty about whether Riyadh can keep markets supplied without disruption. But one veteran oil trader said the accuracy of the JODI figures was the “big unknown”, adding that “overground tracked volume total would appear to be smaller”, a reference to calculations from data analytics firms that use satellites to measure storage.
Saudi Aramco Chief Executive Amin Nasser said his company had more than 60 million barrels of crude inside the country, without specifying how much was abroad. Even if Saudi Arabia keeps the same volumes flowing to customers, there are signs it may struggle to supply the same grades, an important factor for refiners whose plants are often built to handle a specific range of lighter or heavier crudes.
In a sign that requests to change grades are fairly widespread, other refiners in South Korea and Japan, were also asked to make a similar switch, one of the sources said.
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