The political and economic bonds tying Saudi Arabia kingdom to United states may be weakening. Saudi crude exports fell to a 30-year low last month, according to Bloomberg. The exports have been low for several months.
Just 525,000 barrels a day of Saudi´s crude have been imported in October. This is lowest amount of oil since May 1987. It is a huge reduction as decade ago imports to US were 1.5 million barrels a day. Saudi Arabia is now only fourth biggest oil exporter to U.S., only behind Canada, Iraq and Mexico. Loss of markets share fuels fears over loss of political influence in Washington.
„The export drop was part of a wider undertaking by the Organization of Petroleum Exporting Countries to fight a global glut that has weighed on oil prices. OPEC and its non-OPEC allies including Russia are scheduled to meet later this month to discuss prolonging the cuts through 2018,“ Bloomberg reports.
The upside-down trade relationship between Saudi kingdom and United States is demonstrated by the fact that U.S. enjoyed its first trade surplus since 1998. Nevertheless, Saudi officials said that they plan further cuts to crude shipments to U.S. This could only amplify the new trend.
The ongoing shale revolution could damp chances of Saudi Arabia returning to U.S. oil market. America simply do not need foreign oil. By December 2018, U.S. could produce an all-time high of over 10 milliona barrels a day, Energy International Agency reports.
The loss of market share of Aramco, Saudi Arabian Oil Co., comes at a interesting moment as oil giant prepares for Initial public offering. IPO is scheduled for the second hlaf of 2018.
Shift away from U.S. market could be compensated by turning to Asia market, notably China or India. Sales in Japan earlier this year jumped to highest levels in last 28 years.