Nonstopdrivel
15 years ago

FEBRUARY 23, 2010
Saudi Arabia Shifts its Focus to China as the United States Falls Out of Favor 

BY JASON SIMPKINS, Managing Editor, Money Morning

Saudi Arabia, the world's largest oil producer, last year shipped more oil to China than it did the United States for the first time ever - a shift that highlights China's ascension to the ranks of the world's economic elite, as well as its position as the new focal point for the world's energy producers.

The flow of oil from Saudi Arabia to China rose to more than 1 million barrels per day (bpd) last year, just as demand in the United States fell below that level for the first time in more than two decades.

China in December alone imported a record-high 1.2 million bpd of Saudi oil, as its economy rode the momentum of Beijing's $585 billion (2 trillion yuan) stimulus package. U.S. imports of Saudi oil, on the other hand, fell to a 22-year low of 998,000 bpd in the first 11 months of 2009, as the world's largest oil consumer clawed its way back from its worst recession in 70 years.

"This is a reflection of the global economy," Jim Burkhard, managing director of global oil at IHS Cambridge Energy Research Associates, told The Financial Times. "China has been growing. The U.S. hasn't. We've seen that reflected in oil demand figures."

China's economy grew by 10.7% year-over-year in the fourth quarter of 2009, compared to 5.7% growth for the United States.

On top of that, China last year supplanted the United States as the world's largest auto market with 13.6 million vehicles sold. Roughly 10.4 million light vehicles were sold in the United States in 2009 - the lowest total since 1982 and a 21% decline from 2008.

China's purchases of Saudi Arabian oil rose about 14% last year, as a result. U.S. demand peaked above 10 million bpd in 2005 but has fallen 9% in the past two years. Saudi Arabia has reacted by striking new refining deals with Beijing and moving storage facilities from the Caribbean to Japan.

Saudi Arabian Oil Co. (Saudi Aramco), the world's biggest crude producer, already owns a 25% interest in a refinery in China's Fujian province, and is in talks with China Petroleum & Chemical Corp. (NYSE ADR: SNP) to take a stake in a 200,000 bpd plant in Shandong.

"We are already exporting more to China than to the U.S.," Saudi Arabian Oil Co. Chief Executive Officer Khalid A. Al-Falih said in an interview with BusinessWeek. "We are prudent and careful about where to invest but our eyes are focused on China and we will continue to look for all opportunities."

Many refiners have been forced to postpone expansion projects and idle plants in the past year as the global recession eroded fuel demand. But Al-Falih said his company is investing in refining capacity even regardless of current poor returns.

"Long term there will be a lot of consolidation and retirement of old and inefficient refineries," he said. "We are building refineries that are going to be the most efficient, well-configured and able to deliver the products and we are comfortable that over their life cycle they will be very profitable. We are not designing them for the markets of 2008, 2009 but we are putting them in place for the next three to four decades."

China and Saudi Arabia aim to boost trade 50% to $60 billion by 2015, the state-owned Saudi Press Agency reported last month, citing Chinese Trade Minister Chen Deming.

"China offers demand security, something that for a long time the oil-producing countries including Saudi Arabia have called for," John Sfakianakis, chief economist at Banque Saudi Fransi in Riyadh, told The FT. "As global demand has been picking up in the east... Saudi Arabia has been looking east."


UserPostedImage
Fan Shout
beast (19m) : Wow, 95% drop in investment revenue? Would be interesting to hear the details of why...
dfosterf (25-Jul) : It's my one day deal complaint dept. on shareholder meeting day
dfosterf (25-Jul) : Probably a homer access credential intimidation kinda thing
dfosterf (25-Jul) : Meathead "journalists" skip this, concentrating on operational revenue when convenient. They switch when net revenue is more favorable.
dfosterf (25-Jul) : Resulting in an actual drop of net revenue of 12.5%. She is from Minnesota. Just sayin'
dfosterf (25-Jul) : Any plans to hold Maureen Smith (CFO) accountable for a 95% drop in investment revenue?
Mucky Tundra (25-Jul) : In your face, HBO!
Mucky Tundra (25-Jul) : @ByRyanWood Mark Murphy: “A great source of pride of mine is that we were never on Hard Knocks.”
Mucky Tundra (25-Jul) : *years
Mucky Tundra (25-Jul) : @mattschneidman Mark Murphy says he anticipates “many Packers games” being played in Germany, Ireland and/or the U.K. over the next 5-10 yea
dfosterf (25-Jul) : *cafeteria* I have hit my head also, so I sympathize
dfosterf (25-Jul) : Possibly hit his head leaning into the glass protecting the food in the cafateria
dfosterf (25-Jul) : Maybe a low flying drone
dfosterf (25-Jul) : Did Savion Williams run into a goalpost or something?
Mucky Tundra (25-Jul) : also, no bueno when a guy starts getting concussions right off the bat in his career
Zero2Cool (25-Jul) : Concussion is worse. Banks probably vet off day via back booboo claim
Mucky Tundra (25-Jul) : @AndyHermanNFL Jordy Nelson out at camp today. No word if he’s in play for one of the two open roster spots ; )
dfosterf (25-Jul) : Is that better or worse than Banks bad back?
Zero2Cool (25-Jul) : Savion concussion ... not good.
packerfanoutwest (24-Jul) : Aaron Rodgers’s first pass of first team period was picked off
Mucky Tundra (24-Jul) : tbh I didn't hear of his passing
Zero2Cool (24-Jul) : Cosby Show. Malcom Jamal Warner I think is real name
Mucky Tundra (24-Jul) : I was thinking of Ozzy and Hulk
Mucky Tundra (24-Jul) : Who's Theo?
Zero2Cool (24-Jul) : How is Theo alliteration?
Mucky Tundra (24-Jul) : Bad week for people whose names are alliterations
Zero2Cool (24-Jul) : Hulk Hogan gone too.
Zero2Cool (24-Jul) : Oh, it's toe injury
Zero2Cool (24-Jul) : Hope it's not serious. that would stink
dfosterf (24-Jul) : Sounds like an ankle not a knee for Fields
dfosterf (24-Jul) : Ya Flaccp on Browns
Zero2Cool (24-Jul) : Maybe Tyrod Taylor instead
Zero2Cool (24-Jul) : He's on Browns, right?
dfosterf (24-Jul) : They would probably go with Flacco is my guess if Fields out
dfosterf (24-Jul) : Fleece 'em again!
Zero2Cool (24-Jul) : Malik Willis might be someone Jets come after
packerfanoutwest (24-Jul) : Packers introduce 1923-inspired classic uniform, leather-look helmet
Zero2Cool (23-Jul) : Both LB Quay Walker and Rookie DB Micah Robinson have passed their physicals
Zero2Cool (23-Jul) : Happy to see site feels more snappy snappy
Zero2Cool (23-Jul) : No sir. I did not.
dfosterf (23-Jul) : You didn't get free childcare when you were at work?
wpr (23-Jul) : These guys make hundreds of thousands of dollars a year. Pay for their own childcare.
dfosterf (23-Jul) : 2nd issue. Number 1 issue was no gameday childcare. 1 of 3 teams not providing it
Zero2Cool (23-Jul) : Suppose if locker room is main issue, we sitting pretty
wpr (23-Jul) : I thought so Mucky. In those useless player polls GB always rates high overall. Locker is a part of it.
Mucky Tundra (23-Jul) : Wasn't the locker room just updated like 6 or 7 years ago?
Zero2Cool (23-Jul) : I have forum updated on different site. We'll see how this one goes before going to that
Zero2Cool (23-Jul) : Elgton Jenkins has a back injury, is expect to end contract dispute
wpr (23-Jul) : It's funny the PA complained about the locker room. It wasn't that long ago it was top shelf. Things change in a hurry.
wpr (23-Jul) : The site is much more better.
Please sign in to use Fan Shout
2025 Packers Schedule
Sunday, Sep 7 @ 3:25 PM
LIONS
Thursday, Sep 11 @ 7:15 PM
COMMANDERS
Sunday, Sep 21 @ 12:00 PM
Browns
Sunday, Sep 28 @ 7:20 PM
Cowboys
Sunday, Oct 12 @ 3:25 PM
BENGALS
Sunday, Oct 19 @ 3:25 PM
Cardinals
Sunday, Oct 26 @ 7:20 PM
Steelers
Sunday, Nov 2 @ 12:00 PM
PANTHERS
Monday, Nov 10 @ 7:15 PM
EAGLES
Sunday, Nov 16 @ 12:00 PM
Giants
Sunday, Nov 23 @ 12:00 PM
VIKINGS
Thursday, Nov 27 @ 12:00 PM
Lions
Sunday, Dec 7 @ 12:00 PM
BEARS
Sunday, Dec 14 @ 3:25 PM
Broncos
Friday, Dec 19 @ 11:00 PM
Bears
Friday, Dec 26 @ 11:00 PM
RAVENS
Saturday, Jan 3 @ 11:00 PM
Vikings
Recent Topics
17m / Green Bay Packers Talk / beast

23m / Green Bay Packers Talk / beast

25-Jul / Around The NFL / Mucky Tundra

25-Jul / Green Bay Packers Talk / Mucky Tundra

25-Jul / Green Bay Packers Talk / TheKanataThrilla

25-Jul / Green Bay Packers Talk / dfosterf

25-Jul / Around The NFL / beast

24-Jul / Green Bay Packers Talk / Martha Careful

24-Jul / Around The NFL / beast

24-Jul / Green Bay Packers Talk / Mucky Tundra

23-Jul / Green Bay Packers Talk / beast

23-Jul / Green Bay Packers Talk / wpr

22-Jul / Random Babble / Zero2Cool

22-Jul / Green Bay Packers Talk / Zero2Cool

22-Jul / Green Bay Packers Talk / Zero2Cool

Headlines
Copyright © 2006 - 2025 PackersHome.com™. All Rights Reserved.