2015-05-20

Saudi Says No To Extra Chinese Demand

Saudi consumes its own oil.

Saudi Arabia, OPEC partners turn down Chinese requests for extra oil
Saudi Arabia and its main Middle East OPEC partners are turning down Chinese requests for extra oil as they hold back fuel for their own refineries just as demand from the world's biggest crude importer hits new records.

While the Saudi and other refusals for additional crude supplies may not be part of a new pricing strategy, the rejections to their biggest client help explain a 40 percent rise in oil prices this year as Chinese importers have had to seek more oil from other suppliers in what analysts say is still an oversupplied market.

Senior Chinese oil traders told Reuters the Saudis have turned down requests from Chinaoil and Unipec - the respective trading arms of PetroChina and Sinopec - for extra cargoes of crude for May and June loadings, forcing them to seek supplies from producers in West Africa, Oman and Russia.

Saudi Arabia "used to provide as and if we asked for extra cargoes on top of contract during the first four months of the year, but not for May and June," said a trader with one of China's biggest oil importers on condition of anonymity as he had no permission to talk to media.

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