Saudi oil exports to US at zero for first time in 35 years – world news

The U.S. did not import Saudi crude oil for the first time in 35 years last week, as opposed to just a few months ago when Britain threatened to overturn the U.S. energy industry by causing a tsunami of exports to a market destroyed by the plague.

The absence of shipments is due to sluggish shipments of crude oil to the United States, which left the desert kingdom in October. The downtrend is just beginning to appear as Saudi Arabia’s oil tankers take about six weeks to reach the import terminals on the western or Gulf Coast. This is the first week the US has failed to deliver, based on weekly data available through June 2010 from the US Energy Intelligence Agency. Looking at the longer history of the monthly figures, we can see that there was no Saudi revenue for the first time since September 1985.

Earlier this year, the Organization of Petroleum Exporting Countries (OECD) oil producers and ten non-OPEC allies agreed to cut production by 9.7 million barrels per day after a short free production when prices plummeted. Even while fuel consumption struggles to return to pre-epidemic levels, the reduction in supply has helped supply crude oil. Last month, oil prices rose in hopes that demand could improve as many vaccines were released to combat the health crisis.

However, the U.S. is still struggling with the pandemic, with many states imposing new restrictions due to record infections, and other parts of the world are recovering. Gasoline consumption in the U.S. fell to its lowest level during the Thanksgiving holiday, which is in demand as usual.

The loss of demand was so severe that some US refineries were idle. “Throughput is still lower than before the crisis due to declining domestic demand. Sandy Fielden, Morning Star’s Director of Petroleum and Products Research, said:

In Saudi Arabia, reducing shipments to the United States is the fastest way to inform the wider market that supplies are shrinking. The government alone has a huge influence among oil traders in publishing weekly data on crude oil stocks and imports. Other large oil-consuming countries, such as China, publish information on oil supplies in a timely manner.

In May and June, shipments to the United States from Saudi Arabia more than doubled from a year ago. The onslaught was tweeted by Texas Republican Senator Ted Cruz in April, “A message to the Saudis: Turn the tram into hell.” The US refinery received the final installment of its bumper rods in early July.

Since then, Saudi Arabia’s US crude oil shipments have steadily declined. Just two weeks ago, they delivered only 73,000 barrels per day to customers, according to preliminary data from the US Energy Intelligence Agency.

Still, Saudi Arabia won’t give up US supplies anytime soon, even during this pandemic. Oil tanker tracking data monitored by Bloomberg shows an increase in shipments in the kingdom in November. Nevertheless, there is a long gap between the first ships arriving this week on the west coast and the next ships arriving on December 23rd.

“Saudi will keep in mind that it will no longer lose US market share to other sellers,” said Morning Star’s Fielden. That’s why, he added, despite US off-season demand, Saudi Arabia cut prices for shipments in January to US buyers.

In the short term, Joe Biden’s election could help Saudi Arabia. The transition from hydrocarbons will have a long-term impact on oil demand, but hopes to revive the 2015-Iran nuclear deal will pave the way for more Iranian oil to flow into the world. Andy Lipow, president of Lipow Oil Associates LLC in Houston, said, “These sales will replace Saudi oil, which means Arabia will have to rely on the US to keep sales.