- Saudi Arabia's crude oil exports fell to the lowest since 2002 in May at 3.434 million bpd
- Crude production rose to 6.560 million bpd in May despite the decline in exports
- Domestic refinery throughput increased to 2.386 million bpd, boosting local crude consumption
Saudi Arabia's crude oil exports declined for the third consecutive month in May, dropping to their lowest level since official records began in 2002, according to data released by the Joint Organizations Data Initiative (JODI). The decline comes against the backdrop of heightened geopolitical tensions in the Middle East and increased domestic crude consumption.
Saudi Arabia exported around 3.434 million barrels of crude oil per day (bpd) in May, down sharply from 3.986 million bpd in April. The latest figures mark the lowest monthly export level since JODI began publishing Saudi oil data more than two decades ago.
Production Rebounds Despite Lower Exports
While exports declined, Saudi Arabia increased crude oil production during the month. Output rose to 6.560 million bpd in May from the record low of 6.316 million bpd recorded in April, Reuters report.
The divergence between rising production and falling exports suggests that a larger share of crude was consumed within the country rather than shipped overseas.
Saudi Arabia also increased refinery activity during the month. Crude throughput at domestic refineries climbed to 2.386 million bpd in May from 2.211 million bpd in April. Direct crude burning also rose by 107,000 bpd to 647,000 bpd, indicating stronger domestic energy demand.
Also Read: India's Crude Import Bill Shoots 61% In April-June Despite Slip In Volume
Middle East Conflict Continues to Influence Oil Flows
Market analysts believe regional geopolitical developments continued to weigh on Saudi crude exports.
UBS analyst Giovanni Staunovo said the decline in exports was likely influenced by the ongoing conflict in the Middle East, while higher domestic crude consumption also contributed to lower overseas shipments.
The Gulf region has witnessed increased disruptions to shipping routes following the escalation of tensions involving the United States and Iran, raising concerns over the movement of energy supplies through the Strait of Hormuz, one of the world's busiest oil transit corridors.
Fresh Security Concerns Emerge
Adding to market uncertainty, Yemen's Iran-aligned Houthi movement announced on Monday that it would impose a naval blockade on Saudi Arabia, potentially creating another flashpoint in the region.
Saudi Arabia rejected the allegations made by the Houthis, with the country's foreign ministry stating that claims of a maritime blockade on Yemen were false. The ministry added that the kingdom would take all necessary measures to safeguard its vessels and maritime interests.
The latest developments have heightened concerns over the security of shipping routes that are critical to global crude oil trade.
IEA Expects Global Supply to Recover
Despite current disruptions, the International Energy Agency (IEA) expects global oil supply to expand by 7.5 million barrels per day next year after an estimated contraction of 3.7 million bpd this year.
However, the agency has indicated that the projected recovery depends significantly on the uninterrupted movement of oil tankers through the Strait of Hormuz.
The latest Saudi export data highlights how geopolitical tensions and changing domestic demand patterns continue to influence global oil markets, even as the world's largest crude exporter gradually raises production.
Also Read: Iran-US Tensions Keep Crude Oil, Global Markets On Edge
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