Page 4 - AsianOil Week 49 2021

AsianOil ASIA-PACIFIC AsianOil

Oil prices rise

again in Asia

PERFORMANCE IN a move most of those in Asian energy circles
had hoped to avoid, Saudi Arabia has once again
increased oil prices for buyers across Asia as well
as from the US.
Asia is already the destination of 60% of
all crude exported from the Kingdom, where
China, India, Japan and South Korea import the
lion’s share of total Saudi exports.
With a decision made just days after OPEC
had taken steps to raise crude oil output, the
Saudi Arabia-led bloc has left some on the conti-
nent less than impressed, albeit it is a clear indi-
cator that the more influential voices in OPEC
still see Asian markets as being a source of signif-
icant demand throughout the winter.
The Secretary-General of OPEC, Abdalla
Salem El-Badri, meanwhile issued a vague
statement about the bloc maintaining supply
adjustments, although with no direct reference
to future possible price fluctuations.
Prices for Arab Light grade were up by $0.60
cents on the back of an announcement by Saudi
Aramco, and will now see buyers across Asia
forced to pay a 22-month high premium to
maintain imports at current levels.
Markets and governments across Asia have
been relatively slow to react, as much of the con-
tinent focuses on keeping the latest coronavirus
(COVID-19) variant of note, omicron, at bay,
although at least one survey of regional oil trad- conjunction with a request from the administra-
ers and some refiners had been expecting the tion of US President Joe Biden saying Tokyo was
increase. preparing to release “a few hundred thousand
Buyers stateside are facing a similar hike of kilolitres”.
between 40 and 60 cents per barrel, although South Korea and India are also understood
sources indicate that European buyers will see to have co-operated with the same US request.
In both China and Japan, and across wider
In both China their prices drop. Asia, prices at the pump as a result of the con-
The increase in the Saudi national oil pro-
and Japan, and ducer Aramco’s official selling price (OSP) tinuing oil crunch continue to pinch, with num-
across wider through January 2022 comes even as OPEC bers reaching highs not seen since 2015 in some
has committed to increase supplies of crude by countries. Some fuel prices in Taiwan are almost
Asia, prices at 400,000 barrels per day (bpd), at least until the double those seen 18 months ago, when the pan-
demic first hit.
end of the month.
China in particular throughout much of
In recent weeks two of Asia’s four industrial
the pump as powerhouses, China and Japan, have subse- November was facing a winter of power cuts and
a result of the quently moved to release long-held oil reserves limited supply of energy to several of its larger
continuing oil in response to increasing prices and limited cities in the north of the country, where temper-
demand.
atures can drop to well below zero in winter.
China started its own release early in Novem-
As a result, talk of shifting suppliers is a pos-
crunch continue ber to help stave off localised shortages across the sibility that has been raised by some in Asia,
to pinch. country, with Foreign Ministry spokesperson with increased Indonesian output a long-term
possibility.
Zhao Lijian in Beijing confirming on Novem-
ber 24 that “China will (continue to) arrange November saw the official Indonesia Crude
the release of state crude oil reserves in light of Price (ICP) for its Minas crude reach $80.15
the situation and needs, and take other neces- per barrel; however, this was a figure up $7.90
sary measures to maintain the stability of the oil from October prices, according to the Ministry
market.” of Energy and Mineral Resources in Jakarta,
A Japanese government spokesperson also ultimately leaving the long-term future of wider
announced a similar move in mid-November in Asian crude supply pegged to OPEC.™

P4 www. NEWSBASE .com Week 49 10•December•2021