Saudi Arabia Slashes November Oil Prices for Asia
Saudi Arabia has surprised the market by cutting its November crude oil prices for Asian buyers, according to a pricing document released on October 5. The state-owned oil giant Saudi Aramco set the Arab Light crude oil official selling price (OSP) for Asia at $5 a barrel, a $3 decrease from the previous month. This discount is the widest since June 2020, according to Reuters data. Analysts had anticipated a $3 increase, aligning with recent gains in Middle Eastern benchmarks.
The price cuts extend to heavier grades, with Arab Medium and Arab Heavy seeing a $5 reduction for Asian buyers. Saudi Aramco has been offering discounts on oil loaded off Oman to offset record freight rates, a move aimed at maintaining market share amid regional conflicts affecting exports. The company also raised prices for north-west Europe by $3 across all grades after resuming exports from the Red Sea port of Yanbu. Prices for U.S. buyers remained unchanged.
On October 4, Saudi Arabia and other OPEC+ members agreed to maintain current oil production targets for November. This decision aligns with expectations that no significant output policy adjustments are likely until 2027.