The world’s top oil exporter is planning to boost exports sharply after a three-year supply-cut deal between the Organization of the Petroleum Exporting Couuntries and other producers led by Russia collapsed earlier this month.
But with demand also collapsing due to government restrictions to contain the coronavirus outbreak, oil companies have been reducing refinery processing rates and are not in a rush to nominate extra Saudi barrels, the sources said.
“There are definitely refinery run cuts,” a trade source, speaking on condition of anonymity, who has discussed the issue with oil companies said. “So then it is hard to nominate a lot.”
Shell is among the major oil companies taking less Saudi crude, two industry sources said. One source said companies were seeking to cut their April allocations of Saudi crude by as much as 25 per cent. Shell declined to comment.
Saudi state oil company Aramco also declined to comment.