US, WASHINGTON (ORDO NEWS) — Several European and Scandinavian oil refineries will cut purchases from Saudi Arabia in April, industry sources say, suggesting that this was due to the lack of demand for additional volumes of oil that the kingdom offered the market to fight for share.
The world’s largest oil exporter plans to sharply increase supplies after the collapse of the OPEC + oil restriction pact.
But demand for oil is falling due to restrictions imposed by various countries around the world in efforts to curb the coronavirus epidemic, and oil companies are cutting refining, and therefore are in no hurry to contract additional volumes from Saudi Arabia, sources say.
“This is definitely a reduction on the part of refiners,” said a trader who spoke on condition of anonymity and discussed this issue with oil companies. “So now it’s hard to contract a large volume.”
Shell is one of a number of large oil companies cutting back on Saudi oil purchases, two industry sources said. One source said companies intend to cut April shipments of Saudi oil by 25%.
Shell declined to comment. Saudi oil company Aramco also declined to comment.
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