A Thank You To Readers And A Note On Record Amount Of Oil To Be Burned By Saudi Arabia To Power Air Conditioning -- July 21, 2020

First things first: a huge "thank you" to readers, again. A reader caught a huge mistake in an article that I linked. I completely missed it so I consider that an error on my part also. And it was a huge error (pipeline capacity stated to be 250 million bopd when in fact closer to 25 thousand bopd). But the error was quickly noted and corrected.

But that's only half the story. The other reason to thank readers: folks don't alert me to minor typographical errors that don't affect the story and which I generally eventually find and correct later. Sometime much later. But it's nice to not be "nickeled-and-dimed-to-death" on every inconsequential typographical error.

But please let me know if I make any significant errors, typographical or otherwise.

And so we move on.  

One of the reasons I love to blog: had I not blogged about the Bakken, I never would have paid attention to this. I must have first learned about it ten years ago; I forget. But here we go again. Another "summer story" in which Saudi Arabia uses record amounts of crude oil to produce electricity for air conditioning. From Bloomberg:

As the Middle East enters the hottest days of summer, Saudi Arabia is set to burn potentially record amounts of crude oil to run its power plants and keep its citizens comfortably air-conditioned.

Electricity consumption always soars around July and August, when temperatures in the kingdom can rise above 122 degrees Fahrenheit. That compels the government to use crude or fuel oil in addition to the much cleaner natural gas that normally fires the plants.

But this year the urge to drain oil is even stronger because of higher demand, with the coronavirus pandemic forcing many Saudis to cancel their summer holidays abroad.

Another difference is that record cuts to Saudi Arabia’s oil production since April -- part of a push by OPEC members to prop up prices in the face of the virus -- have reduced its supplies of gas, most of which come from the same wells as crude.

The extra oil going toward power may limit the price impact of OPEC’s plan to taper output restrictions from next month. The kingdom pumped 7.5 million barrels a day in June, the fewest since 2002, according to data compiled by Bloomberg.

Of those, it exported 5.7 million barrels daily, while keeping most of the rest for domestic refineries.

“They can simply import more gas or burn more crude in power generation,” said Carole Nakhle, chief executive officer of London-based consulting firm Crystol Energy.

“The second option is more likely and easier since the region has been doing this for years and decades and there is plenty of oil around today.”

Each August, Saudi Arabia uses 726,000 barrels of crude daily for power generation, according to average numbers over the past decade from the Riyadh-based Joint Organisations Data Initiative, which collates statistics among energy producers.

That’s more than double the amount for the cooler months of January and February. The record came in July 2014, when the Saudis burned 899,000 barrels a day.

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ISO New England Today