Mideast Market for Heavier Crude Tightens Further

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An already tight market for medium and heavy sour crudes is getting squeezed further by an upgrade at Abu Dhabi’s giant Ruwais refinery complex. The move allows the 837,000 barrel per day facility to process up to 417,000 b/d of heavier crudes, prompting Abu Dhabi to push out an equivalent volume of light, sour Murban crude onto the market. The ramp up of Kuwait’s new 615,000 b/d Al-Zour refinery, which runs fully on Kuwaiti crude — likely the medium, sour Kuwait Export grade — was already pinching the Mideast market for heavier blends. This has been reflected by falling Kuwaiti crude exports, which averaged 1.3 million b/d in the first four months of 2024, down 410,000 b/d from the same period last year. Now, Mideast sources say Abu Dhabi’s crude flexibility project has reached full capacity, which allows the 417,000 b/d Ruwais Refinery West to process 100% medium and heavy sours. With Abu Dhabi National Oil Co. (Adnoc) mainly feeding Ruwais West with its medium, sour Upper Zakum crude, this has caused Upper Zakum exports to drop to just 566,000 b/d in April, down by 394,000 b/d from last October, based on Vortexa data. Most of this decline has occurred this year, with exports tumbling by 290,000 b/d from December. By May, a trader said Upper Zakum exports could drop to around 300,000 b/d below levels seen in late 2023.

This article was originally published by a www.energyintel.com

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