A sudden decline in U.S Oil inventories 2021-11-10T18:20:23 oil inventories oil price Saudi Arabia A sudden decline in U.S Oil inventories A sudden decline in U.S Oil inventories: On Tuesday, Nov 9, 2021 the American Petroleum Institute (API) reported the first decline of crude oil stockpiles in six weeks. Evest follows market developments in the following report. Topics: Decline in Oil And Gasoline Oil prices for the week Oil production weekly rates Saudi Arabia is unsatisfied with reducing reserve oil production Aramco In Saudi Arabia The impact of oil prices rise on Saudi’s economy Decline in Oil And Gasoline The API estimated a decline of 2.485 million barrels in crude oil stockpiles, this week. Despite the rise over the past six weeks, U.S. crude oil stockpiles are still less by 60 million barrels than they were at the year’s beginning, and still lower enough to keep pressure on prices progressively. Yet analysts expected a rise of 1.90 million barrels for the week. In the last week, the API recorded a rise of 3.594 million barrels in oil stockpiles, compared with the 1.567 million barrels expected by analysts. The API proclaimed a drop in gasoline stockpiles by 552.000 barrels by the week ending Nov 5, compared with last week’s consumption of 552.000 barrels. Distillate stockpiles rose by 573.000 barrels throughout the week, compared with last week’s rise of 573.000 barrels. Oil prices for the week On Tuesday, oil prices rose before data was published, West Texas Intermediate crude rose to $83.96, Brent crude was for $84.57 a barrel in dealings. West Texas Intermediate crude rose by midday to less than $50 in the week, while Brent crude stood steadily this week. Oil production weekly rates U.S. Oil production for the week ended on 29 Oct (the last week, the EIA has reported data about production) rose by 200.000 bpd to be 11.5 million bpd, but still less by 1.6 million bpd than its highest levels ever of 13.1 million bpd; which has been reached directly before the pandemic has struck the USA. Saudi Arabia is unsatisfied with reducing reserve oil production The CEO of the world’s largest oil exporter said that the expected rise of plane fuel demand, will slow down the demand recovery on other fuels and would consume all energy reserves. Amin Nasser, ARAMCO’s CEO said yesterday that the world will witness a decline in oil reserves capacity production in the next year, as demand on plane fuel is back to pre crisis levels. He added that the reserve capacity of the industry is 3 or 4 million bpd and it is easing the market, he also said that the reserve would decline especially in the next year when demand rise and that should arouse concerns, according to Reuters Nasser said that the insignificant reserves capability amid shortage of investment in oil and gas should arouse market’s concerns. “Expanding capacity in the oil industry takes from 5 to 7 years, and the world’s investments aren’t enough to raise capacity; that is also a big source of worry.” Nasser said. Aramco’s In Saudi Arabia Aramco CEO confirmed the company plan to raise its production capability to 13 million bpd by 2027 as its production is 12 million bpd for now, confirming that demand on oil and gas will stay in order for decades. “Renewable energy can’t meet the world’s energy needs.” Said Nasser in a forum reported by Bloomberg. Aramco’s CEO asserted the company’s view that the global oil demand will exceed 100 million bpd in the early time of the next year. At the end of the last month Nasser said that crude oil production capacity is diminishing globally and there is an urgent need of more investments in the new production. Nasser also said to Bloomberg that this is a big source of worry; he added that if the aviation sector recovered in the next year, the reserve energy would run out. As the offer now is limited and all reserves are declining fast. The impact of oil prices rise on Saudi’s economy Saudi Arabia recorded 6.8% economic growth for the third quarter on the basis of oil prices rise, Reuters noted in a report that this is the highest quarterly growth for the kingdom since 2012. Saudi’s general authority for statistics said that the positive growth is due to a 9.0% rise in oil activities 9.0% as a result of the global demand rise on crude oil and the rise of Saudi’s production. The general authority for statistics added that the seasonal average of the domestic production rose 5.8% per quarter, due to the expansion of 12.9% in the Saudi oil activities. Oil prices rose greatly since the year beginning due to the progressive demand and lack of offer, including globally reserved oil. As a consequence oil producers got unexpected gains. Aramco recorded net gains of $30.4 billion for the third quarter of this year, recording 158% rise from the third quarter of 2020. The CEO, Amin Nasser, said that the strong quarterly result is due to the global economic recovery, which made the demand on energy rise. Nasser noted that Aramco’s low cost product helped in its performance in the third quarter as well. “The global economy is facing some challenges, this is partly due to logistics chain problems; but we are still optimistic that the energy demand will stay in order in the near future.” Amin Nasser said. As it benefited from the oil basics case, Saudi Arabia raised its official selling price of “RB light” for Asian buyers more than $1 per barrel. As a consequence Asian traders and refinery companies will pay $2.70 for Saudi’s light crude oil, delivered by December over the average of Oman and Dubai. The country is maintaining its production rates, although it is working to increase its production capacity to 13 million bpd.