China Invests in Domestic Crude Production
July 10, 2023
The Baker Hughes Rig Count had oil rigs down 5 this past week in the US. The total number of oil rigs in the US is now at 540 and last year at this time there were 597 oil rigs. The oil rigs down 5 was called supportive to energy prices.
Crude oil and refined fuel prices were higher on Friday as the US dollar traded lower on a poor US jobs number. The weaker jobs growth raised the possibility that the Fed will not be as ready to raise interest rates.
Prices were higher as the current sentiment seem to be worried about supplies versus the fears that rate hikes could slow economic growth.
Vortexa reported that there was currently 10.5 million barrels of Saudi Crude oil floating in storage off the Egyptian Red Sea port of Ain Sukhna, down almost half from mid-June. This is fundamentally supportive of prices.
The Biden Administration announced on Friday it is purchasing six million more barrels of crude oil for the SPR. The purchases are scheduled for October and November.
Chin is spending billions of dollars to try and boost the own domestic oil production. According to Bloomberg China has added 600,000 barrels of extra oil production. Pumping roughly 4.3 million bpd. This makes China the fifth largest oil producer, behind US, Saudi Arabia, Russia, and Canada.