Saudis promise to open oil spigots
The Saudis say they can produce 11 million barrels of crude daily, The Journal said. Last month, the Saudis produced 9.5 million barrels a day to meet customers' needs, up from about 9.2 million barrels a day the previous month, The Journal said.
But as it approaches capacity, the Saudi output includes a greater percentage of medium and heavy-grade crudes that are less attractive to refiners whose plants are configured for light, low-sulfur crudes, The Journal noted.
The Saudis have operated at full capacity only twice in recent years, The Journal said, on the eve of the U.S.-led invasion of Iraq in 2003 and in 2004 after a series of hurricanes largely shut down operations in the Gulf of Mexico and production in Texas and Louisiana, which has the nation's largest concentration of refineries.
The Saudi offer comes as oil prices continue to surge, The Journal said, and the kingdom begins to worry that the increases could backfire on oil-producing nations later this year by slowing global growth.
OPEC has promised to produce more oil, but that move has had little effect on prices, The Journal said.
The Saudi vow to meet all orders goes well beyond the cartel's March decision to raise its output ceiling and sidesteps bickering among members over whether to raise the limit even further, The Journal said.
