Oman crude averages $44.50 amid output fall

Oil exports increased by 4.5% in Jan. 2017 compared to the previous month to reach 26.7 million barrels

  
06 March 2017
Samuel Kutty
Muscat - The average price for a barrel of Omani crude oil fetched $44.50 in January this year amid a 3 per cent fall in production in the same month compared to December 2016. Oil exports increased by 4.5 per cent in January 2017 compared to the previous month to reach 26.7 million barrels. According to analysts, the number is encouraging to balance the  2016 and 2017 budgets which have a break-even $45 oil price although  the aver¬age price for 2016 ended up being around $39 a barrel.

“The fall is the result of an agreement by coalition of oil producers to trim production. As far as the prices are showing an upward trend, the government will be able to balance the deficit” said Louay Badie al Bataina, CEO of Ubar Capital.

The decrease in oil production in January 2017 is attributed to the decrease in crude oil by 1.6 per cent, to reach 27.4 million barrels, compared with 27.9 million barrels in the previous month.

The production of condensate oil decreased by 15.6 per cent to reach 2.5 million barrels during January 2017 compared to 3 million barrels in the previous month.

Oil exports increased by 4.5 per cent in January 2017 compared to the previous month to reach 26.7 million barrels.

Global rating agency Fitch in its recent forecast said the Sultanate’s real GDP will grow 3 per cent in 2016, mainly due to strong increases in oil and gas production.

“We assume hydrocarbon production will be flat in 2017 but will increase in 2018 as the Khazzan gas field comes on stream, potentially adding up to 25 per cent or $ 5 billion to gas production ”, it said in a rating upgrade note.

At the same time, data from National Centre for Statistics and Information (NCSI) showed that refineries sales recorded a decrease of 4.8 per cent reaching 3.9 million barrels during January 2017 compared to 4.1 million Barrel during the previous month.

This decrease is attributed to the decrease in the sales of oil gas by 8.5 per cent, car fuel M95 by 7 per cent and car fuel M91 by 2.1 per cent.

On the other hand, the sales of aviation fuel oil has increased by (8 per cent) and liquefied petroleum gas by 7.9 per cent during that period.

Meanwhile, NCSI data showed that both production and imports of natural gas in January 2016 decreased by 3.9 per cent compared to the previous month.

It also decreased by 4.5 per cent compared to the same period of the previous year.

The use of natural gas in power generators went down by 4.6 per cent to 495 million cubic meters, while use in industrial areas denoting gas consumption in Industrial Estates, Oman Mining Co., Oman Cements and SQU increased by 6.8 per cent to 53 million cubic meters.

Industries projects logged a fall in natural gas consumption of 0.7 per cent at 2.18 billion cubic meters.

On the other hand, use of natural gas in oil fields decreased by 15.1 per cent to 693 million cubic meters, last year compared with consumption figures for 2015.

© Oman Daily Observer 2017

More From Commodities