Saudi Arabia will import about 34,100 barrels per day of gasoline in August, steady to July volumes, due to problems at a new gasoline production unit in the kingdom, industry sources said on Wednesday.The world's top oil exporter, which was expected to cut back gasoline imports significantly, is forced to keep buying spot barrels due to start-up problems at the new residual fluid catalytic cracking (RFCC) unit at Rabigh Refining and Petrochemical (PetroRabigh) , sources familiar with the new unit's operations said.
"There seems to be quite a few issues with the new unit, this is why Saudi Arabia is going to have to keep importing gasoline over the next two months," a Middle East based source said.
PetroRabigh, a $10.3 billion joint venture between Saudi Aramco and Japan's Sumitomo Chemical started partial operation of its facilities in the fourth-quarter of 2008. The plant has the capacity to produce up to 60,000 bpd of high-octane gasoline that will be converted from fuel oil.
Gasoline imports into the kingdom are expected to fall about 15,000 bpd this year, energy consultancy PFC Energy said.
Demand for the motor fuel which is heavily subsidised in the Gulf Arab state hit a record high of nearly 400,000 bpd in April, up 6 percent compared to the same period last year, PFC Energy said in a report.
The OPEC member also imported about 120,000 tonnes of gasoline in July. Saudi Arabia buys high-octane gasoline mainly from the Middle East and Mediterranean and the start-up problems at the PetroRabigh RFCC will prompt the kingdom to continue importing the motor fuel until September, an industry source had said.
The kingdom's continued imports come at a time when global gasoline prices are firming due to outages in Taiwan, the United States and Europe, with Asian gasoline cracks having doubled over the past week to $8.76 a barrel on Tuesday.
"The plan for Saudi was to cease gasoline imports by the third quarter, but the problems on this new gasoline unit at Rabigh is going to take a while to sort out," a trader familiar with the kingdom's monthly gasoline imports said.
"But by the end of the year they should be able to be close to self-reliance because all this production from the new unit is mainly for domestic use."
PetroRabigh shipped its first gasoline cargo of about 320,000 barrels to the southern city of Jizan last month, the company said last month.