ENERGY

Aramco tells Japan’s top distributor about possible shipment change: Report

The Abqaiq oil-processing facilities are the heart of Saudi Aramco's operations. (AFP)

Saudi Aramco has notified Japan’s biggest oil distributor about potentially changing the oil grade it supplies from light to heavy and medium starting in October, Nikkei Asian Review said on Sunday.

According to JXTG Nippon Oil & Energy, Japan’s biggest distributor, Aramco did not mention why it wants to change the shipments.

JXTG officials told the Nikkei Asian Review that they believe Aramco is taking more time than expected to repair its desulfurization facility, which is required to produce light-grade crude used in the production of gasoline and light gas oil.

Aramco did not immediately respond to Al Arabiya English's request for comment.

The Kingdom accounted for nearly 40 percent of Japan's oil imports in fiscal year 2018.

Saudi Aramco’s refineries in Abqaiq and Khurais were attacked by drones on September 14. The attacks, which were claimed by the Iran-backed Houthi rebels in Yemen, slashed about half of the country’s oil production – roughly five to six percent of the world’s global oil supply.

The Abqaiq oil-processing facilities are utilized for the desulfurization of Saudi Arabia’s crude supply, Refintiv confirmed to Al Arabiya English last week. Abqaiq is also where Saudi Arabia stores strategic crude reserves

“This is the heartland of the operations,” said Ranjith Raja, Lead Analyst – Shipping and Oil Research for Middle East and North Africa at Refinitiv.

If the damage to Abqaiq had not been contained, it could have also delayed Saudi Arabia’s capacity to tap into its reserves in order to offset production loss, he added.

On September 18, Saudi Energy Minister Prince Abdulaziz bin Salman pledged that the Kingdom would maintain full oil supply to its customers this month, while oil production capacity will rebound to 11 million barrels per day (bpd) by the end of September.

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Last Update: Sunday, 22 September 2019 KSA 09:20 - GMT 06:20
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