S&P Global Platts (market reports provider) referred that in coming months, there would be gradual increase in production of crude oil by Saudi Arabia due to higher demand, said by Khalid-Al-Falih (Oil Minister) this weekend, and also last week, the U.S. president Donald Trump again flared at OPEC (The Organization of the Petroleum Exporting Countries), for permitting crude oil prices hike.
Al-Falih adding in his statement said that the production would be dependent on the customer demand, and won’t be an attempt to control prices. Riyadh has officially declared that the only factor determining the production is demand.
In June, Saudi Arabia assured to increase the production of crude oil to make hold over the increasing prices, but the average production value for July was disappointing with 10.29 million barrels per day, and for August, the average daily production increased to 10.42 million barrels per day. The production would be further increased in coming months, according to Al-Falih.
In Algiers, Al-Falih said that their plan is to maintain Saudi crude oil demand and supply rates. If the demand is more than the production, then the bank will meet the demand. However, in October statistics are projected to be more than the current figures. As per increase in the rate of crude oil production every month, the production would become more than demand by October.
Already, some clients were asking for extra shipments other than the shipments they had contracted originally with Aramco. The minister also assured them for the delivery of additional shipments. On the other side, the U.S. is trying to break oil exports from Iran, as Iran has withdrawn Iranian nuclear deal in May. South Korea has decreased Iran imports to almost zero; While for Turkey and Japan, there has been a noticeable decrease of Iran imports.
Owing to U.S. sanctions over cutting of Iran oil exports to the market, it causes doubts over the statements of Saudi Arabia to meet the higher demand for crude oil worldwide.