Iraq’s largest oil refinery at Baiji was damaged in an attack that destroyed two of four production lines and killed four employees. Libya’s biggest refinery, Ras Lanuf, had its supply of crude interrupted due to violent clashes there.
Saudi Arabia increased oil output to make up for the loss of more than half of Libya’s crude production due to the anti-government uprising in the North African country, the International Energy Agency said.
The following is a weekly summary of Persian Gulf crude and product market news and forthcoming events:
Additional oil supplies from Saudi Arabia are heading for the Mediterranean Sea after violent clashes between opponents of Libyan leader Muammar Qaddafi and forces loyal to him cut the nation’s oil output by at least 850,000 barrels a day from 1.6 million before the conflict, the IEA said in a statement.
Saudi oil is generally higher in sulfur than Libyan crude, though the kingdom’s Arab Super Light stream “is of similar quality,” the Paris-based IEA said. The “closest quality replacement” oils are from Algeria, the North Sea, West Africa and the Caspian Sea, it said.
The IEA, which advises the world’s most industrialized nations, estimated Saudi Arabia’s average January crude production to be 8.6 million barrels a day, unchanged from December, according to the agency’s Feb. 10 monthly report.
Libya’s oil export terminals are operating only partially because port personnel are taking refuge from violence in some parts of the country, Dario Scaffardi, general manager at Italian refiner Saras SpA, said on a conference call Feb. 25.
Saudi Aramco was said to have sold the first crude cargo from its new storage facility on Japan’s Okinawa island, three people with direct knowledge of the transaction said. State-run Aramco sold a cargo of heavy-grade Khafji crude from an Aframax-size tanker, which can carry 650,000 barrels, to an Asian refiner in the spot market, the people said, asking not to be identified as the transaction is confidential.
Petroleum Development Oman made a “material” discovery of oil at a deposit holding some 300 million barrels of crude and will start production at the site called Amal Southeast this year, Managing Director Raoul Restucci said in the Omani capital, Muscat. PDO made three additional oil finds, at Sayyah, Al Ghubar East and Aqeeq, Restucci said.
Aramco, the world’s largest crude exporter, will start trading refined oil products this year through a new unit that seeks to take advantage of the company’s expanding refinery business. The wholly owned unit, Saudi Aramco Product Trading Co., will buy and sell refined fuels internationally and start operations in Dhahran, Aramco said.
Said Al-Hadrami will be the president and CEO of Aramco Trading, as the new unit will be known.
Abu Dhabi National Oil Co. settled the price of naphtha supplies to Asia for the year from April at premiums of $17.50 to $20 a ton over benchmarks, according to buyers involved in the negotiations. Among premiums for other products, Splitter naphtha sold at $17.50 a ton over Middle East benchmark prices, Low-Sulfur grade at $18.50 a ton and Pentane-Plus naphtha at $20 a ton, said the people who asked not to be identified because the talks were not public.
Two production lines at Iraq’s oil refinery in the northern city of Baiji were destroyed and four staff killed in an attack by militants. Output at the 250,000 barrel-a-day complex, the country’s largest, fell by 150,000 barrels a day, an engineer at the refinery named Saad Mahmud said by telephone yesterday.
Libya’s largest refinery, the 220,000 barrel-a-day capacity Ras Lanuf, has had its crude supply interrupted and is exporting fuel processed from existing stockpiles, two company officials said today.
The refinery in the city of Ras Lanuf has enough crude for a few more days, one of the officials said. The plant is still exporting products, mainly to European countries, and the city’s port is functioning for now, the officials said.
Bahrain Petroleum Co. started a partial maintenance shutdown of units at its 267,000 barrel-a-day refinery on Feb. 16 until early April. Bapco, as the refiner is known, shut a hydrocracker at the refinery for servicing.
Kuwait plans a full closure of its 200,000 barrel-a-day Shuaiba refinery for 45 days starting April 3, Mohammed Al-Ajmi, a spokesman for the state-run refinery operator Kuwait National Petroleum Co., said Feb. 15. Shuaiba is the oldest and smallest of Kuwait’s three refineries.
Saudi Aramco was set to start operating a new diesel-fuel unit at its Ras Tanura refinery this month, two people with knowledge of the project said. The hydrotreater will produce low-sulfur diesel, said the people, who asked not to be identified because the plans haven’t been made public. Samsung Engineering Co. won a contract in Dec. 2007 to build the 100,000 barrel-a-day unit.