Saudi Arabia Looks To Fill The Gap In Iran’s Condensate Sales

Saudi Arabia Looks To Fill The Gap In Iran’s Condensate Sales  -  a peculiar move that's clearly directed at capturing market share from Iran as the Saudis are freeing up 'Khuff Condensate' which is usually used as a blendstock by domestic refiners, using more Arab Extra Light (a blend that trades at a premium, even to Brent) as a replacement.

 

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27 minutes ago, TomTom said:

Saudi Arabia Looks To Fill The Gap In Iran’s Condensate Sales  -  a peculiar move that's clearly directed at capturing market share from Iran as the Saudis are freeing up 'Khuff Condensate' which is usually used as a blendstock by domestic refiners, using more Arab Extra Light (a blend that trades at a premium, even to Brent) as a replacement.

 

Interesting. So they normally refine this very expensive ultra light oil domestically. But now they are refining a cheaper grade and selling the extra expensive one. This either makes sense or it doesn't, regardless of Iran's circumstances, no? So why haven't they always sold the pricier version? 

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7 minutes ago, Rodent said:

Interesting. So they normally refine this very expensive ultra light oil domestically. But now they are refining a cheaper grade and selling the extra expensive one. This either makes sense or it doesn't, regardless of Iran's circumstances, no? So why haven't they always sold the pricier version? 

No, both Arab extra light and the Saudi condensate are blendstocks used to dilute heavier Saudi crudes in their domestic refineries - I guess the supply of this Khuff condensate is (much) lower than the supply of Saudi Extra Light, and they're just looking to displace a rather large quantity of Iranian condensates..

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My understanding is that it's rarely traded, but I think the UAE also started buying it last year to replace Qatari supplies when the shit hit the fan in that fun Gulf rivalry

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I like how Bloomberg calls it the Saudis' own self-imposed "oil diet"

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