Saudi Aramco Cuts Asian Oil Prices to Six-Year Low

Saudi Aramco has slashed prices for its benchmark crude oil to Asia, marking the steepest discount in six years as Gulf producers compete for market share. The state-owned oil giant will lower the price of Arab Light crude to Asian buyers by $5 per barrel below the regional benchmark for November. This unexpected cut contrasts with a $2 discount in October, defying expectations of a $5 price increase.

The move signals Saudi Arabia's effort to boost sales to Asia, mirroring strategies by other Gulf producers. Meanwhile, Aramco raised November prices to Europe by $3 per barrel and kept U.S. prices unchanged. Despite ongoing attacks near the Strait of Hormuz, oil flows through the waterway have rebounded, with Middle Eastern exports nearing pre-war levels, according to JPMorgan Chase & Co.

Aramco has advised Asian refiners to submit nominations for oil volumes from various ports, including Gulf locations and the Red Sea, as a precaution against potential closures of the Strait of Hormuz. The East-West pipeline, damaged earlier, has been restored to over 80% capacity, increasing export volumes via the Red Sea. Meanwhile, military tensions persist, with Yemen's Saudi-backed government launching a campaign against Houthi forces, keeping shipping costs elevated.