Saudi Arabia Cuts Flagship Crude Price to Asia to Six-Year Low

Deep News
3 hours ago

Saudi Arabia has lowered the official selling price of its flagship crude for November deliveries to Asia, following an increase in oil shipments through the Strait of Hormuz.

A price list from Saudi Aramco shows that Arab Light crude for Asian buyers will be priced at a discount of $5 per barrel to the regional benchmark, compared with a discount of $2 per barrel this month.

Traders and refiners surveyed earlier had expected the November price to rise by $5 per barrel from October.

Oil shipments through the Strait of Hormuz have picked up over the past few months. At the same time, Saudi Arabia has restored most of the throughput on its East-West pipeline after the conduit was damaged in an attack.

Middle Eastern crude exports have risen as a result, with JPMorgan estimating last week that volumes had recovered to 98% of pre-war levels.

Shipping costs, however, remain elevated.

Saudi Aramco's official selling prices apply to crude sold to refiners under long-term contracts. Typically, buyers take delivery at Ras Tanura in the Persian Gulf.

Because risks persist in passing through the Strait of Hormuz, many customers are avoiding the route, forcing producers to move crude through the strait and then transfer it onto tankers waiting in the Gulf of Oman.

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