Saudi oil export revenues over the first four months of the year are down 7% year-on-year. This is substantially less than the 15% fall in Saudi crude output over the same period, as these output cuts, alongside those implemented by other Opec+ producers since May 2023, have helped support oil prices. Prices for Saudi Arabia’s flagship Arab Light crude grade have been slightly higher than year-ago levels through early 2024.
The recent extension in full of Saudi Arabia’s 1mn b/d voluntary cuts through to October as part of a broader package of Opec+ cuts should provide further near-term pricing support, especially as global demand enters its peak season (MEES, 7 June). Oil prices initially sank following the announcement of a roadmap to return Opec+ barrels to the market from October, but Brent prices have since returned to more than $85/B and Standard Chartered suggests they could make a relatively rapid move towards $90/B this summer. Others are less bullish, with Citi saying “we recommend not to chase this rally as current price levels look too rich to us.” (CONTINUED - 939 WORDS)
