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London: Saudi Arabia will keep oil supplies steady to some of its big-gest customers in March, although some Asian refiners were expected to receive additional crude, trade sources said yesterday.
Opec has pledged to reduce supplies by a total of 1.7 million barrels per day, including a second cut of 500,000 bpd taking effect from February 1.
Several Opec ministers have said there will be no need for a further output cut when the group meets in March, provided there is no significant change in market conditions.
The sources said major companies with global refining systems would be receiving the same volumes as in February.
"We're getting what we asked for. It is unchanged from February," one source said, declining to give further details.
Another source also said supplies to international companies would be unchanged. In Asia, however, some refiners were expecting to receive slightly higher volumes than they did for February.
One South Korean refiner will receive about eight per cent less crude than stipulated in its annual contract, a shallower cut than the 13 per cent curbs it received in February, a source said.
A Taiwanese refiner was expecting a similar 7-8 per cent cut versus its 10 per cent this month.
State oil firm Saudi Aramco normally issues similar reductions to all its customers in Asia, who buy about half of the kingdom's seven million barrels per day of exports and pay a premium for their oil compared with clients in Europe and the US.
Allocations
There was no word on allocations to customers in Japan, where businesses were shut for a national holiday and many European refiners were not yet available for comment.
Saudi Arabia has so far adhered to Opec's pledged cuts and some traders said higher supplies to some refiners would be offset by reduced deliveries elsewhere. "Lifting supplies to Asian refiners might signal deeper cuts to Western refiners, considering the Asian premium," said a source with one Asian refiner.
"By supplying more to Asia and less to the United States and Europe, Saudi will still be producing and supplying the amount as planned but will be making higher revenue."
Oil prices fell more than a dollar yesterday. US crude was trading 82 cents lower at $59.07 by 1043 GMT, while ICE Brent crude fell 88 cents to $58.13.
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