Demand for Saudi crude is likely to rise over the next few months, Saudi oil minister Ali Al-Naimi told Reuters on Monday, in a sign the world’s largest oil exporter sees a recovery of demand in Asia, its biggest export market.
State-run Saudi Aramco cut production sharply in the fourth quarter of last year because of weak economic growth abroad and lower consumption in cooler weather at home.
It kept output steady at around 9.05-9.15 million barrels per day (bpd) in January and February, but industry sources said in February that exports could rebound in the second quarter, driven by demand growth in Asia.
Naimi confirmed on the sidelines of a meeting in Doha that he expected external demand for Saudi crude to rise over coming months but said that it “remains to be seen” by how much.
With Europe still wallowing in debt and the United States consuming more of its own oil, demand from china is the main driver of Saudi oil exports.
China’s factory activity rebounded in March in a sign that the underlying economic recovery is strong enough to weather any risks from patchy export performance, surveys showed on Monday.
China imported 1.08 million barrels a day of crude from Saudi Arabia in 2012, up 7.24 per cent from 2011, and state-run CNPC expects China’s total net imports to rise again this year.
Saudi Arabia, OPEC’s leading producer and holder of the world’s only significant spare capacity, slashed its output by around 700,000 bpd over the last two months of 2012, helping drive a rise in crude prices from early December to mid-February.