Saudi Arabia Unexpectedly Cuts Oil Prices To Asia

By Yomna Ehab and Siyi Liu

Oct 5 (Reuters) – Saudi Arabia has unexpectedly cut November crude oil prices for Asia while it raised those for northwest Europe and the Mediterranean regions, a pricing document showed on Monday.

The largest Middle Eastern crude exporter set the November Arab Light crude oil official selling price to Asia at $5 a barrel below the average of Oman and Dubai prices, down $3 from the previous month. The discount for November is the widest since June 2020, Reuters data showed.

This was against expectations of a $3 a barrel hike for its November OSP in a Reuters survey in line with gains seen in the Middle Eastern benchmarks. State oil company Saudi Aramco <2222.SE> made deeper cuts of $5 a barrel for the November OSPs of heavier grades — Arab Medium and Arab Heavy — sold to Asia.

Aramco has been looking at offering discounts for oil loaded off Oman to compensate buyers for record freight rates, people familiar with the matter said last week, as it sought to protect its market share after the regional conflict hit exports.

Separately, Saudi Aramco raised the November OSPs for northwest Europe by $3 a barrel across all grades after it resumed exports from the Red Sea port of Yanbu.

Aramco kept prices unchanged for buyers in the United States.

Saudi Arabia and other members of OPEC+ agreed on Sunday to keep oil production targets steady for November, in line with expectations that further output policy adjustments are unlikely until next year.

(Reporting by Yomna Ehab and Menna Alaa ElDin in Cairo, Florence Tan and Siyi Liu in Singapore; Editing by Nia Williams, Cynthia Osterman and Sonali Paul)