Saudi Arabia Edges Out Russia in China Oil Sales as OPEC Digs In

Saudi Arabia reclaimed its position from Russia as the largest crude supplier to China as OPEC members extended their global fight for market share.
The world’s biggest oil exporter sold 3.99 million metric tons to China in October, 0.8 percent more than in September, data from the Beijing-based General Administration of Customs showed on Monday. Angola, another member of the Organization of Petroleum Exporting Countries, also surpassed Russia in shipping crude to the Asian nation.

China has become a battleground for oil producers who are seeking to defend sales amid a worldwide oversupply. Prices have slumped 40 percent since OPEC embarked on a strategy last November to keep pumping and drive out higher-cost competitors such as U.S. shale companies. The 12-member group is scheduled to meet next week and Venezuela has warned that crude could drop to as low as the mid-$20s a barrel unless action is taken to stabilize the market.
“Saudi Arabia never stopped fighting for market share in China and in Asia as a whole,” Gao Jian, an analyst at SCI International, a Shandong-based energy consultant, said by phone. “One year after OPEC announced its production policy to defend market share, their strategy seems to be working.”
Saudi Arabia this year twice ceded the top spot to Russia in crude sales to China, in May and September. The kingdom accounted for about 15 percent of China’s imports in the first 10 months of this year, compared with 12 percent for Russia, according to the customs data.

Russia supplied 3.41 million tons to its neighbor in October, a 16 percent drop from a record in September. Angola’s shipments climbed 27 percent from the previous month to 3.64 million tons, the data showed.    

Bloomberg News