Arab News, Sunday, Aug 28, 2022 | Safar 1, 1444
Saudi Arabia’s June fuel oil imports increase 60% annually as supply rises
Saudi Arabia: Saudi Arabia’s fuel
oil imports in June surged 60 percent to 307,000 barrels per day compared to the
same month last year to meet the increasing energy demand for air conditioning
to quell the summer heat.
According to the global energy market analysis
body Joint Organizations Data Initiative, this rise marks the highest
year-on-year change since November 2020, when fuel oil imports rose by 94.5
percent to 354,000 bpd.
The northbound trend in fuel oil imports started
in May when Saudi fuel imports increased 78.5 percent to 241,000 bpd from
135,000 bpd in April and further rose 27.4 percent in June.
Historically, the Kingdom’s fuel oil consumption
usually doubles during the sweltering heat of the summer season since the oil is
burned in the power generation of cooling systems. As a result, it has to import
the commodity to satisfy the seasonal demand.
According to media and research reports, the
Kingdom sourced 34.3 percent of its June imports from Egypt, 25.5 percent from
the UAE and 21.1 percent from Estonia, besides procuring fuel oil from other
It is a slight change in the partnership,
considering that the Kingdom purchased the low-priced fuel directly from Russia
before the Ukraine conflict.
In 2017, Saudi Arabian Oil Co. signed a memorandum
of understanding with Litasco, the trading arm of Russia’s second-largest oil
company Lukoil, to trade non-Saudi crude.
The deal entailed regular fuel oil cargoes
delivered to the Kingdom until year-end.
The Kingdom’s fuel oil imports from Russia
presently transit via Estonia’s Tallin Port. There is also a share of the oil
imports that are shipped to Aramco’s storage facilities in Egypt’s Ain El-Sokhna
and the hub of Fujairah in the UAE and then diverted to Saudi Arabia’s Dammam
and Jeddah ports.