Saudi Arabia slashes November oil prices to Asia in market strategy shift
Saudi Arabia has made a surprise move by cutting its November crude oil prices for Asian buyers, while raising prices for customers in northwest Europe and the Mediterranean. The state-owned oil giant Saudi Aramco set the November Arab Light crude oil official selling price (OSP) for Asia at US$5 a barrel below the average of Oman and Dubai prices, marking a US$3 reduction from the previous month. This discount is the widest since June 2020, according to Reuters data. The decision defied expectations of a US$3 a barrel increase, as indicated by a Reuters survey aligned with gains in Middle Eastern benchmarks.
Aramco also introduced deeper discounts of US$5 a barrel for heavier grades, Arab Medium and Arab Heavy, destined for Asia. This strategy appears aimed at maintaining market share amid regional conflicts that have disrupted exports. Meanwhile, Aramco boosted November OSPs for northwest Europe by US$3 a barrel across all grades following the resumption of exports from the Red Sea port of Yanbu. Prices for U.S. buyers remained unchanged.
Saudi Arabia and other Opec+ members agreed on Sunday to maintain steady oil production targets for November, suggesting no further output policy adjustments are expected until next year.