Saudi Arabia increases oil output to escalate price war
Energy titan Saudi Aramco said Tuesday it will boost its supply of crude oil to 12.3 million barrels per day in April, flooding markets as it escalates a price war with Russia. "Saudi Aramco announces that it will provide its customers with 12.3 million barrels per day of crude oil in April," the company said in a statement to the Saudi stock exchange.
- Economy
- AP
- Published Date: 01:15 | 10 March 2020
- Modified Date: 01:17 | 10 March 2020
Saudi Arabia's state-run oil giant Saudi Aramco said Tuesday it would increase its crude oil production to 12.3 million barrels a day in April, a record amount.
The move seems to make good on the country's promise over the weekend to increase output after Russia refused to cooperate on cutting production. That led to a 25% plunge in the price of crude on Monday.
In a filing made Tuesday on Riyadh's Tadawul stock market, Aramco - formally known as the Saudi Arabian Oil Co. - said that the increase in production represented a rise of 300,000 barrels per day.
"The company has agreed with its customers to provide them with such volumes starting 1 April 2020," it said in the filing. "The company expects that this will have a positive, long-term financial effect."
Saudi Aramco shares were up 9.7% in trading Tuesday on the Tadawul to 30.95 riyals, or $8.25, giving the world's most-valuable company a valuation of $1.65 trillion.
It came a day after Aramco shares collapsed by 10% and were pulled from trading for reaching the Tadawul's maximum permitted loss in a day, dropping its valuation to $1.4 trillion. It offered only a sliver of its shares on the Tadawul for investors.
Aramco's decision likely will flood global energy markets and put further pressure on prices. The company had reached $2 trillion in early days of trading in December.