Common wisdom says that China and India are guzzling down all the world’s oil, but the WSJ highlights another fast-growing consumer: the Middle East. Translation? More and more of Saudi Arabia’s oil is fueling Saudi Arabia–and less is hitting the the world markets:
Fresh data from the U.S. Department of Energy show the amount of petroleum products shipped by the world’s top oil exporters fell 2.5% last year, despite a 57% increase in prices, a trend that appears to be holding true this year as well.
Soaring profits from high-price crude have fuelled a boom in oil demand in Saudi Arabia and across the Middle East, leaving less oil for export. At the same time, ageing fields and sluggish investments have caused exports to drop significantly in Mexico, Norway and, most recently, Russia. The organisation of Petroleum Exporting Countries also cut production early last year and didn’t move to boost supplies again until last fall….
For all the attention paid to China’s increasing energy thirst, rising energy demand in the Middle East may pose the greater challenge. Last year, the region’s six largest petroleum exporters — Saudi Arabia, United Arab Emirates, Iran, Kuwait, Iraq and Qatar — curbed their output by 544,000 barrels a day. At the same time, their domestic demand increased by 318,000 barrels a day, leading to a loss in net exports of 862,000 barrels a day, according to the U.S. Energy Information Administration.
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