Saudi Arabia has unexpectedly cut its November crude oil prices for Asian buyers while raising them for Europe, a pricing document showed on Monday — a split decision that surprised a market expecting increases across the board.
State oil giant Saudi Aramco set the November official selling price for its flagship Arab Light crude to Asia at $5 a barrel below the average of Oman and Dubai prices, down $3 from October. The discount is the widest since June 2020, according to Reuters data. The move ran directly against expectations: a Reuters survey had pointed to a $3-a-barrel hike in line with gains in Middle Eastern benchmarks.
Heavier grades cut deeper
Aramco made even deeper cuts of $5 a barrel to the November official selling prices of its heavier grades, Arab Medium and Arab Heavy, sold to Asia. The company has been looking at offering discounts for oil loaded off Oman to compensate buyers for record freight rates, people familiar with the matter said last week, as it seeks to protect market share after the regional conflict disrupted exports.
The pricing was not uniformly lower. Aramco raised November official selling prices for northwest Europe by $3 a barrel across all grades after resuming exports from the Red Sea port of Yanbu, and kept prices unchanged for buyers in the United States.
Tight market, steady targets
The decision came a day after Saudi Arabia and other core OPEC+ members agreed to keep November production targets steady, with the group signalling that further output policy adjustments are unlikely until next year. Gulf producers have been pumping well below their targets amid export disruptions from the conflict involving Iran, leaving the physical market tight even as headline targets stay unchanged.
For Asia's refiners — the world's largest buyers of Saudi crude — the deeper discount offers some relief from elevated freight costs, but it also signals Riyadh's determination to defend its share of the region's imports.
Sources: Reuters, GMA News (Reuters)
State oil giant Saudi Aramco set the November official selling price for its flagship Arab Light crude to Asia at $5 a barrel below the average of Oman and Dubai prices, down $3 from October. The discount is the widest since June 2020, according to Reuters data. The move ran directly against expectations: a Reuters survey had pointed to a $3-a-barrel hike in line with gains in Middle Eastern benchmarks.
Heavier grades cut deeper
Aramco made even deeper cuts of $5 a barrel to the November official selling prices of its heavier grades, Arab Medium and Arab Heavy, sold to Asia. The company has been looking at offering discounts for oil loaded off Oman to compensate buyers for record freight rates, people familiar with the matter said last week, as it seeks to protect market share after the regional conflict disrupted exports.
The pricing was not uniformly lower. Aramco raised November official selling prices for northwest Europe by $3 a barrel across all grades after resuming exports from the Red Sea port of Yanbu, and kept prices unchanged for buyers in the United States.
Tight market, steady targets
The decision came a day after Saudi Arabia and other core OPEC+ members agreed to keep November production targets steady, with the group signalling that further output policy adjustments are unlikely until next year. Gulf producers have been pumping well below their targets amid export disruptions from the conflict involving Iran, leaving the physical market tight even as headline targets stay unchanged.
For Asia's refiners — the world's largest buyers of Saudi crude — the deeper discount offers some relief from elevated freight costs, but it also signals Riyadh's determination to defend its share of the region's imports.
Sources: Reuters, GMA News (Reuters)
