Crude oil exports have sharply declined in August as the kingdom leads the efforts of the OPEC+ alliance to reduce production and support oil prices. The observed flows from the kingdom collapsed to around 5.6 million barrels per day, the lowest since March 2021. This compares to the revised 6.3 million barrels per day in July. Shipments to most major destinations, including China and the United States, plummeted to their lowest levels in several years.

The Organization of the Petroleum Exporting Countries (OPEC) and its allies, including Russia, are curbing supply to bolster the market, particularly in the face of slowing demand in China, a major oil consumer. Since July, Saudi Arabia has committed to implementing a unilateral production cut of 1 million barrels per day in addition to existing restrictions.

Flows to China, the kingdom’s primary market, dropped to around 1.3 million barrels per day. This is the lowest level observed since June 2020, during the early months of the pandemic, when global oil demand plummeted. Saudi exports to Japan and South Korea fell to their lowest levels in August since Bloomberg began tracking them in 2017.
Shipments to the West also plunged. Observed cargoes to the United States were only 81,000 barrels per day, the smallest volume seen in at least six years.

Saudi Arabia wasn’t the only Middle Eastern energy giant to curb its flows in August. Kuwait, the fifth-largest OPEC producer, saw shipments fall to around 1.5 million barrels per day, the lowest since at least late 2016. Shipments to China, the largest buyer of Kuwaiti barrels, plummeted by about 45%.

Behind the numbers are different realities. China, increasingly buying from Russia at discounted prices, has little to worry about. The drop in exports to the United States and the Western world is more a sign of a radical shift in energy geopolitics and an increasingly significant threat to the Western world, seen as arrogant, imperialistic, and having failed to fulfil most of its commitments in the East for over forty years.