Saudi Arabia extends Covid measures by another 20 days

Saudi Arabia will extend ongoing restrictions on gatherings, entertainment activities and events by another 20 days in response to a worsening of the Covid-19 situation in some regions of the kingdom. This extension of the measures will likely weigh on transport fuel demand in the country.

The announcement, made earlier today, will keep in place the restrictions first imposed on 4 February for an initial 10 days through until 6 March. According to the ministry of interior, a further extension is possible if the situation continues to worsen.

Since 4 February social gatherings have been limited to a maximum of just 20 people, while all entertainment and in-restaurant dining have been completely suspended. Shopping malls and sports centers have also been closed.

This comes as the number of daily Covid-19 cases continues to rise. The authorities have reported an average of 334 new Covid-19 cases daily so far in February, up from 172 cases in January and 174 in December.

This increases in Covid-19 cases recently prompted Saudi Arabia to push back its plans to reopen its borders to mid-May, from the initially planned 31 March.

The country also banned arrivals from 20 countries, in the first week of February, dealing a blow to prospects for a recovery in regional jet fuel demand in the upcoming months. Saudi Arabia is the second largest jet consumer in the region behind the UAE.

Today's announcement will put further pressure on already fragile gasoil and gasoline demand as well.

Saudi gasoil demand fell by 8pc month-on-month to a ten-year low [of 410,000 b/d in November, according to the latest data from the Joint Organisations Data Initiative (Jodi). The last time demand was lower was November 2010, when it stood at 370,000 b/d. Gasoline demand, meanwhile, fell by 4pc month-on-month to 510,000 b/d in November.

By Ieva Paldaviciute