The amount of oil Saudi Arabia supplied to markets fell last month, according to a person familiar with the country’s oil policy. Its production climbed.
The world’s biggest crude exporter supplied 9.36 million barrels a day last month, a reduction of 328,000 barrels daily from August, according to the person, who asked not to be identified, citing policy. The supply figure excludes what’s stored. Saudi Arabia produced about 100,000 barrels a day more than in August, the person said.
Crude collapsed into a bear market this month as Saudi Arabia and other producers deepened price discounts for their oil, amid speculation they’re competing for market share in Asia. Global supplies are rising as the U.S. pumps the most in almost three decades and Russia’s output nears a post-Soviet record. Brent, the global oil benchmark, rose more than 1 percent immediately after the person’s comments.
“If this was an intentional cut by Saudi Arabia, I’d expect them to have cut the actual amount of oil produced and not just the supply to market,” Richard Mallinson, a London-based analyst at Energy Aspects Ltd., said by phone. “More is being read into the fluctuations than should be. I don’t see anything in these latest numbers to indicate a unilateral production cut.”
Angola, Libya and Venezuela have all said OPEC needs to take action on prices, with the Latin American nation’s President Nicolas Maduro calling for an emergency meeting in a televised address Oct. 17. Global markets are oversupplied by about 1 million barrels a day and OPEC needs to reduce collective output by at least 500,000 barrels a day, Libya’s OPEC governor Samir Kamal said by e-mail yesterday, adding that his comments reflected personal views.
Saudi output in September was 9.7 million barrels a day, up from almost 9.6 million barrels a day in August, the person familiar with Saudi policy said. That’s the same as OPEC reported in its most recent market assessment.
Brent crude for December settlement rose as much as $1.94, or 2.3 percent, to $86.65 a barrel in London. West Texas Intermediate crude for December delivery gained as much as $1.38, or 1.7 percent, to $81.90 a barrel on the New York Mercantile Exchange.
“The market is reacting instantly to any news on oil market fundamentals,” Gerrit Zambo, an oil trader at Bayerische Landesbank in Munich, said by phone. “So far these gains have been only a short-term reaction, and then the market seems to go back to its bearish sentiment.”