Saudi assures Bangladesh oil supply not to face disruption despite drone attacks

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Crude oil supply to Bangladesh from Saudi Arabia will not be affected despite a disruption in oil production in the kingdom following drone attacks on an oilfield and a processing facility on Saturday, Bangladesh Petroleum Corporation officials said.

BPC officials on Tuesday said that they had already had communications with Saudi Aramco, the country’s state-owned oil company, and the company confirmed the BPC about supplying the allocated crude oil scheduled for September.

There are no scheduled shipments of the product in next two month, they said.

They said that some 1 lakh tonnes of Arab crude oil are scheduled to be loaded for shipment on September 27.

According to the BPC, Bangladesh imports around 7 lakh tonnes or half of the total demand (12-13 lakh tonnes) for crude oil from Aramco.

The remaining crude oil is imported from the United Arab Emirates’ Abu Dhabi National Oil Company (ADNOC).

‘Hopefully, there will be no supply shortage for Bangladesh as we imports only 7 per cent to 8 per cent of the country’s total demand for both crude and refined petroleum products from Saudi Arabia,’ BPC chairman Md Shamsur Rahman told New Age on Tuesday.

Bangladesh’s current annual demand for petroleum products including diesel, octane, furnace oil and aviation fuel is 58 lakh tonnes.

Bangladesh imports a large volume of refined petroleum oils from different countries under government-to-government agreements while the remaining volume is procured through tender.

The BPC would go for alternative sources if normalcy in production and supply facility in Saudi Arabia does not return, he said.

Saudi authorities said that it might take months for the situation becoming normal.

Saturday’s drone attacks, allegedly carried out by Yemen-based Houthis rebel group, caused a significant damage to Khurais oilfield and Abqaiq processing facility, both owned by Saudi Aramco.

The production of oil has been disrupted by about 5 million barrels a day – nearly half the country’s estimated production of 9.7 million barrels.

According to Reuters, oil futures jumped 10 per cent on Monday after the attacks. Prices initially surged more than 20 per cent after the open on Sunday evening, with Brent crude posting its biggest intraday gain since the 1990-1991 Gulf crisis.

Brent crude futures rose as much as 19.5 per cent to $71.95 per barrel, the biggest intraday jump since January 14, 1991. By 10:37am EDT (1437 GMT) on Monday, the international benchmark was up $6.4330, or 10.7 per cent, at $66.67 a barrel.

BPC officials said the rising oil prices would be a concern for Bangladesh as its payment for petroleum products would rise in the coming months if the trend persisted.

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