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A fleet of oil tankers from Saudi Arabia has begun arriving on the U.S. Gulf Coast. But this country already has plenty of crude oil. So why is there more coming in from Saudi Arabia? NPR's Jackie Northam explains.
JACKIE NORTHAM, BYLINE: In late March, massive tankers in eastern Saudi Arabia were filled with crude oil and then set sail on a long journey to the other side of the world.
MICHELLE BOCKMANN: What you have is a convoy, really, of 18 very large crude carriers that each carry 2 million barrels of crude.
NORTHAM: Michelle Bockmann is an energy commodities analyst at Lloyd’s List, the world's oldest shipping news service.
BOCKMANN: And when you track them on a satellite map of the world, you can actually see them coming down along the east coast of Africa, across the Atlantic, through to the U.S. Gulf.
NORTHAM: Bockmann says it's believed some of the oil has been purchased by U.S. refiners at deeply discounted prices. Some of it is sent on spec. The tankers were loaded when Saudi Arabia went on a production spree, pumping millions of extra barrels each day. Some of the tankers were chartered, including one going for a record-breaking $350,000 per day.
BOCKMANN: They were so keen to get this armada of oil over to the U.S. Gulf, they paid this crazy money.
NORTHAM: The Saudi crude arrives as the U.S. shale industry is being hit hard by a glut of oil on the market because of a drop in demand due to the coronavirus. North Dakota Republican Senator Kevin Cramer told NPR that Saudi Arabia exploited the situation. Cramer is part of a growing chorus calling on President Trump to stop the Saudi oil from reaching refineries on the Gulf Coast.
KEVIN CRAMER: We're allowing Saudi Arabia to continue to have such easy access to the American markets at a time when it is Saudi Arabia, in my view, that is largely responsible for the great supply glut.
NORTHAM: Cramer says he would be all for placing tariffs on the crude but would go further, withdrawing U.S. troops and weapons defense systems from Saudi Arabia.
CRAMER: Why would we put 2,500 troops in harm's way and a whole bunch of missile defense systems in Saudi Arabia to defend their oil when they've declared war on our oil?
NORTHAM: Critics say President Trump has been soft on Saudi Arabia, turning a blind eye to the devastating air offensive in Yemen, human rights abuses and the killing of Saudi journalist Jamal Khashoggi. Kirsten Fontenrose, a former senior director on Gulf affairs in the Trump administration now with the Atlantic Council, acknowledges Trump's close relationship with Saudi Arabia.
KIRSTEN FONTENROSE: Part of it is because there is this kind of personalized relationship between the president and the Saudi royal family that began when the president made his big trip out there in 2017.
NORTHAM: But Fontenrose says the Trump administration sees Saudi Arabia as a valuable ally it needs to stick with.
FONTENROSE: We can either just sort of write them off and then wind up with lots of other problems down the road, or we can say, OK, this is unacceptable. But what we're going to do is try to mentor this behavior change.
NORTHAM: Saudi Arabia may not have got that message, judging from the millions of barrels of crude oil heading to the Gulf Coast.
Jackie Northam, NPR News.
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