Saudis lose out to Russia in oil cuts

Saudi Arabia sacrificed billions of dollars in revenues this year by cutting oil output to prop up the price of crude, only to see Russia snatch a bigger chunk of the market, analysts say.

Now the Gulf kingdom, previously a vigilant enforcer of the cuts by the OPEC cartel that checked the sharp fall in oil prices last year, appears to be expanding its own oil flow again in exasperation.
“The cartel has lost a significant portion of market share in global crude production in the last year mostly to Russia,” wrote Francisco Blanch, a commodities analyst at Bank of America Merrill Lynch, in a note.

With its production capacity rising but output held down by lower quotas, he estimated, “Saudi Arabia’s ‘missed oil revenues’ are probably running at close to 100 billion dollars per annum, or almost 25 percent of GDP.”

AFP