Saudi Arabia Slashes Asian Oil Prices Unexpectedly in November
Saudi Arabia has taken the market by surprise with a significant cut in its November crude oil prices for Asia, while simultaneously raising prices for key European regions. The world's largest Middle Eastern crude exporter set the official selling price (OSP) for its Arab Light crude oil to Asia at US$5 per barrel below the average of Oman and Dubai prices, marking a US$3 reduction from the previous month. This discount is the steepest since June 2020, according to Reuters data. The move defied expectations of a US$3 per barrel increase, as predicted by a Reuters survey.
Saudi Aramco, the state-owned oil company, also implemented deeper cuts of US$5 per barrel for heavier grades, Arab Medium and Arab Heavy, sold to Asian buyers. Industry insiders revealed that Aramco has been considering offering discounts for oil loaded off Oman to offset the impact of record freight rates, aiming to safeguard its market share amid regional conflicts that have disrupted exports.
In contrast, Aramco raised November OSPs for north-west Europe by US$3 per barrel across all grades, following the resumption of exports from the Red Sea port of Yanbu. Prices for the United States remained unchanged. The adjustments come just a day after Saudi Arabia and other OPEC+ members agreed to maintain steady oil production targets for November, signaling that further output policy changes are unlikely until next year.