After the success of the OPEC+ compromise deal on cuts, the UAE has decided to give a little more crude to Asian oil buyers from next month onwards.
While OPEC’s third-largest producer UAE will still lower the supply to the world’s biggest oil-consuming region, Asia in January, the control won’t be as rigid as December in percentage terms.
Abu Dhabi National Oil Co (ADNOC) has planned to reduce the contractual volumes for its flagship Murban crude by 20 percent and cut its offshore oil field Upper Zakum and Das by 15 percent, as per people who were notified by the company. This compares with a 20 percent reduction for all grades loading in December.
Last week OPEC+ has agreed to slowly raise supply by adding 500,000 barrels a day of production to the market from January. The conclusion was made after almost a week of distressed negotiations and increased tension between Saudi Arabia and the UAE.
Under the agreement, the UAE can pump an extra 38,000 barrels a day in January, compared with its August-December output.
Abu Dhabi’s ADNOC is also planning to reduce its supplies of offshore oil field Umm Lulu by 5 percent from next month onwards.
Earlier this year, UAE had received severe disapproval from Saudi Arabia, after pumping more than its allocated quota under the agreed OPEC+ cuts. Since then, ADNOC has lowered its supply to Asia by cutting volumes for all grades by 30 percent in October. Before that, controls had been barely 5 percent from July through to September.
In another move, ADNOC raised the official selling price of Murban crude for January by 75 cents from a month earlier to a 50 cents a barrel premium to the Dubai benchmark price. That’s higher than the median projected of a 55 cents a barrel increase in a survey.