UAE oil exports surpassed prewar levels “at a certain time” as the Arab world’s second-largest economy continues to work as reliable supplier to the world, despite Hormuz disruptions.
“At a certain time, we did better than prior because of our continuous work,” UAE’s Minister of Energy and Infrastructure Suhail Al Mazrouei told delegates at the Adipec conference in Abu Dhabi on Monday.
He did not disclose the timelines or the volumes the UAE exported, but said [we] "did our best to make sure that the prices of commodities do not go very high”.
The Emirates shipped 3.94 million barrels per day of crude and condensate in June, the highest monthly total in the past year, and a sharp reversal from March, when the blockade of the Strait of Hormuz cut exports to a record low of 2.13 million bpd, Kpler data showed.
“We feel the pain on those consumers, and we understand that if prices go too high, that's going to strike the demand in years … the pipeline helped us a lot over there. Our readiness through the fleets and the ships have helped us tremendously," Mr Al Mazrouei said.
The UAE's Habshan–Fujairah pipeline, often referred to as the West–East crude oil pipeline, has the capacity to transport up to 1.5 million bpd of crude oil, representing a substantial share of the country’s total oil exports.
In May, the UAE announced the expansion of the West-East crude oil pipeline to be completed by 2027, with the project expected to double export capacity through Fujairah.
Mr Al Mazrouei said the UAE was able to “fill in the supply gap” as supplies from other countries reduced due to the closure of the Strait of Hormuz.
“Sometimes even we have filled in the gap ... we managed to oversupply to those countries because there was a significant reduction from many countries.”
The country must also be ready for worst-case scenarios since it “cannot predict what’s going to happen", he added.
Oil prices volatile
Oil prices have remained volatile since the Iran war broke out on February 28, with prices rising to more than $120 per barrel in March as the Middle East war escalated, with Iran hitting energy infrastructure in the region and ship traffic through the Strait of Hormuz coming to a virtual halt.
Prices fell in subsequent months amid peace talks between the US and Iran to end the conflict and reopen the strait, but surged again amid concerns that the US is preparing to restart the Middle East war and attack Iran.
Brent, the benchmark for two thirds of the world's oil, is trading close to $110 per barrel, with West Texas Intermediate at about $100 per barrel on Monday.
“When I think about what happened over the last eight months, it's really quite stunning the level of disruption to the global energy system. Crude oil, natural gas, products have all been disrupted. The thing that stood out is how resilient the system has been,” Meg O’ Neill, chief executive of BP, said in a separate panel discussion at Adipec.
“If you went back to the start of the conflict, people would have said that oil should have been $150 a barrel by June, and that didn't happen. People said that natural gas prices should have spiked, and they really didn't until the last month or so.”
