(Refiling to fix spelling of pricey in headline)
(Adds quote, West Coast detail)
NEW YORK, June 16 U.S. oil refiners are
unlikely to buy extra oil offered by Saudi Arabia as the
kingdom's prices make its crude uncompetitive with other
grades, two traders with independent refiners said Monday.
Saudi Arabia is expected to raise production by up to
500,000 barrels per day to 9.7 million bpd next month in a bid
to put a cap on oil prices as they race towards $140 a barrel.
"They can offer all the oil they want. The fact is they
want too much for it. There's cheaper oil out there right now,"
said a trader with an independent U.S. oil refiner.
Saudi official selling prices for the United States
currently list Arab Light ARL-OSP-N at a nearly $3 per barrel
premium to comparable U.S. domestic crude grades like Mars
MRS- -- even before the cost of shipping oil from Saudi
Arabia is taken into account.
Traders said they would be willing to increase purchases of
Saudi crude, if prices were lowered.
"Price will determine. They have been less than competitive
on price for several months," said another U.S. crude trader.
Interest in additional Saudi barrels was also muted on the
West Coast, which is more closely linked to Asia-Pacific crude
oil markets than the rest of the United States.
Asian refiners said Monday they were unlikely to increase
their purchases of Saudi oil due to high prices.
Another U.S. crude oil trader with an independent refiner
on the Gulf Coast noted that increased supplies from Saudi
Arabia in July could lead to lower official pricing later in
"If they really do want to pump 9.7 million bpd, then
they'll have to cut the price. But the effect of that won't be
seen in the U.S. for months," said a trader with a second
Saudi Arabia has been the second largest supplier of
imported crude oil to the United States in 2008, shipping an
average of 1.518 million bpd over the first four months of the
year, up from 1.358 million bpd over the same period in 2007,
according to U.S. government data.
(Reporting by Robert Campbell and Bruce Nichols in Houston;
Editing by Walter Bagley)