Exclusive: China buys up Saudi, Russian oil to squeeze Iran | Reuters:
BEIJING/LONDON | Tue Feb 7, 2012
(Reuters) - China is scouring the world for alternative oil supplies to replace a fall in its imports from Iran, as it seeks to negotiate lower prices from Tehran, and has been drawing heavily on Saudi Arabia.
Industry sources told Reuters that Beijing had bought the bulk of an increase in crude oil supplies from top oil exporter Saudi Arabia in the last few months.
The world's second-largest oil consumer is also importing more cargoes from West Africa, Russia and Australia to replace reduced supplies from Iran.
China is the top buyer of Iranian oil, taking around 20 percent of its total exports, but since January it has cut purchases by around 285,000 barrels per day (bpd), or just over half of the total daily amount it imported in 2011.
Saudi Arabian output reached 9.76 million barrels per day (bpd) in December, up 360,000 bpd from October, OPEC data show, and has remained near that level in January, according to a Reuters survey. Several sources in the oil industry said China has bought a good part of the extra oil.
Official Chinese data also show an increase in crude oil imports from Saudi Arabia in the last few months, but on a smaller scale than the rise given by the industry sources.
A Reuters survey of oil flows from West Africa on Monday suggested Asia's imports of crude from the region are at a record high.
Even so, China still needs Iranian oil and even Saudi Arabia and the rest of the Organization of the Petroleum Exporting Countries do not have the capacity to replace it.
With production believed to be around 9.75 million bpd in January, Saudi Arabia holds about 2.75 million bpd of idle production capacity to meet any sudden shortages - less than Iran's output of 3.5 million bpd. Saudi holds the world's only significant unused capacity.
(Additional reporting by Nidhi Verma in New Delhi, Chen Aizhu in Beijing, Francis Kan in Singapore and Peg Mackey in London; Editing by Anthony Barker)
BEIJING/LONDON | Tue Feb 7, 2012
(Reuters) - China is scouring the world for alternative oil supplies to replace a fall in its imports from Iran, as it seeks to negotiate lower prices from Tehran, and has been drawing heavily on Saudi Arabia.
Industry sources told Reuters that Beijing had bought the bulk of an increase in crude oil supplies from top oil exporter Saudi Arabia in the last few months.
The world's second-largest oil consumer is also importing more cargoes from West Africa, Russia and Australia to replace reduced supplies from Iran.
China is the top buyer of Iranian oil, taking around 20 percent of its total exports, but since January it has cut purchases by around 285,000 barrels per day (bpd), or just over half of the total daily amount it imported in 2011.
Saudi Arabian output reached 9.76 million barrels per day (bpd) in December, up 360,000 bpd from October, OPEC data show, and has remained near that level in January, according to a Reuters survey. Several sources in the oil industry said China has bought a good part of the extra oil.
Official Chinese data also show an increase in crude oil imports from Saudi Arabia in the last few months, but on a smaller scale than the rise given by the industry sources.
A Reuters survey of oil flows from West Africa on Monday suggested Asia's imports of crude from the region are at a record high.
Even so, China still needs Iranian oil and even Saudi Arabia and the rest of the Organization of the Petroleum Exporting Countries do not have the capacity to replace it.
With production believed to be around 9.75 million bpd in January, Saudi Arabia holds about 2.75 million bpd of idle production capacity to meet any sudden shortages - less than Iran's output of 3.5 million bpd. Saudi holds the world's only significant unused capacity.
(Additional reporting by Nidhi Verma in New Delhi, Chen Aizhu in Beijing, Francis Kan in Singapore and Peg Mackey in London; Editing by Anthony Barker)
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