Saudi Arabia is set to initiate plans to unleash its oil production to a record level of 12.3 million bpd in April, but this leaves a question whether the state-owned oil company Saudi Aramco can meet such a target. Crude output in Saudi Arabia recently recovered from missile attacks on its crucial Abqaiq crude processing facility in September. Ramping up production to more than 12 million bpd would provide a major test for Aramco's capabilities and infrastructure.
CEO Amin Naser claimed that Aramco’s sustained capacity stands at 12 million bpd. He also said that it can easily pump above maximum sustained capacity. Naser noted that 300,000 bpd out of the targeted 12.3 million bpd supply in April would come from its vast global inventories.
Saudi Arabia’s highest production was recorded in November 2018 at 11.08 million bpd. Last year, it pumped an average of 9.9 million bpd of crude. Some analysts said that Saudi Arabia’s production capacity for a prolonged period might stand at roughly 10.5 million bpd for a few months.
However, the kingdom has developed new field capacities to offset natural depletion rates. These new fields include Shaybah, Manifa, Khurais, Zuluf, Marjan, Berri, and Safaniya fields. The Neutral Zone shared with Kuwait can also provide Saudi Arabia with an additional 500,000 bpd production.
There is also another question about who will buy Aramco’s excess supply. Governments prevent their citizens from leaving home and airliners suspend flights on more routes due to the coronavirus pandemic. As a result, refiners worldwide have lowered their runs as demand and margins for gasoline and jet fuel are squeezed.
