Business | Oil & Gas
Adnoc cuts supply for next two months
Abu Dhabi National Oil Co. (Adnoc) has notified its term customers that it will cut its contracted volumes for Upper Zakum crude oil in November and December by five per cent, the company said on Tuesday.
- Reuters
- Published: 23:43 October 29, 2008
Dubai, Singapore: Abu Dhabi National Oil Co. (Adnoc) has notified its term customers that it will cut its contracted volumes for Upper Zakum crude oil in November and December by five per cent, the company said on Tuesday.
Adnoc will also reduce allocations for the distillate-rich Murban crude by 15 per cent in December, and it will lower supply for Lower Zakum by 10 per cent for the same month.
Adnoc will also cut supplies of Umm Shaif in December by five per cent. November allocations of all crudes except Upper Zakum will be unchanged.
The Organisation of Petroleum Exporting Countries (Opec) agreed on Friday to slash production by 1.5 million barrels per day. The cut was initiated to stem a more than 50 per cent slide in prices.
Most traders said they expected reductions. "We were expecting Adnoc to cut supplies on the other grades for November as well, not just December," a Singapore-based trader said.
The bigger-than-expected cuts for Murban and Lower Zakum also took the market by surprise, traders and refiners said.
"This is a hefty cut, we had initially been expecting something in the range of 5-10 per cent," an Asian refining source said. "It shows the Opec countries are serious about trying to stabilise oil prices and sticking to making cuts as agreed."
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