Published On: Sat, Jun 9th, 2012

Saudi Arabia reduced oil output in May

A report from Dubai claims the world’s top oil exporter Saudi Arabia pumped 9.8 million barrels per day (bpd) of crude oil in May, an industry source said on Saturday, a reduction of 300,000 bpd from April.

Photo/Tech collector via wikimedia commons

A year ago Ali al-Naimi, the Saudi Arabian oil minister announced that the kingdom had sliced its oil output by some 800,000 barrels per day in response to what he said was an oversupply, despite soaring prices.

This is al-Naimi’s statement in 2011: “The market is overbalanced … Our production in February was 9.125 million barrels per day, in March it was 8.292 million barrels per day. In April we don’t know yet, probably a little higher than March. The reason I gave you these numbers is to show you that the market is oversupplied.”

“We believe Saudi Arabia now requires oil at $92 a barrel to break even fiscally, up from $60 a barrel in 2008, on higher post-Arab Spring spending,” Deutsche Bank oil analyst Paul Sankey wrote in a research note last October. The Saudis “will cut production to defend $92.”

$92 barrels of oil appears to be the standard.

On Friday, oil ended the week at $84.10 per barrel, within $1 of its close last week. It remains near its lowest level since October of last year.

Members of the Organisation of Oil Exporting Countries (OPEC) will meet on June 14 in Vienna to review output policy.

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About the Author

- Writer and Co-Founder of The Global Dispatch, Brandon has been covering news, offering commentary for years, beginning professionally in 2003 on Crazed Fanboy before expanding into other blogs and sites. Appearing on several radio shows, Brandon has hosted Dispatch Radio, written his first novel (The Rise of the Templar) and completed the three years Global University program in Ministerial Studies to be a pastor. To Contact Brandon email [email protected] ATTN: BRANDON

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