S&P Global Ratings maintains stable oil and natural gas price decks despite potential Houthi threats to Saudi Arabian refineries.
S&P Global Ratings recently reviewed its oil price deck and decided to leave both its oil and natural gas price decks unchanged. This decision comes despite potential risks from Houthi rebels attacking oil refineries along Saudi Arabia’s west coast, which could impact diesel supplies to Europe. Market analysts note that China’s current oil price stability is largely due to its strategy of drawing down its massive oil reserves, which are estimated to be between 1.3 and 1.6 billion barrels. By reducing its open market purchases by 5-6 million barrels per day, China has kept crude availability resilient. However, experts warn that if China returns to pre-war open market purchase levels, oil prices could see a rapid increase. The U.S. holds the next highest reserves at 410 million barrels of commercial inventories, supplemented by the other 337 million barrels in its Strategic Petroleum Reserve.