RIYADH: Saudi Arabia has reduced the October price of its flagship Arab Light crude for Asia to its lowest level in nearly three years amid concerns over weak regional demand. The official selling price (OSP) for Arab Light crude dropped by 70 cents to $1.30 per barrel above the Oman/Dubai average, according to a statement from Saudi Aramco released late Friday. This marks the lowest price since November 2021.
The reduction exceeded expectations, as a Reuters survey of five sources at Asian refineries had predicted a price decrease of 50 to 70 cents per barrel. This price cut comes in the wake of a significant decline in global crude futures, with Brent crude hitting its lowest point since December 2021.
An Asian refinery source noted that the cut was more substantial than anticipated, attributing it to ample supply in the market. The October OSP for Arab Heavy crude also saw a notable reduction of $1.00 per barrel, driven by a tapering demand after the peak summer fuel consumption period and increased competition from Canadian oil exports.
The price reduction follows OPEC+’s decision to delay a planned increase in oil output for October and November, amid a nine-month low in crude prices. The group has indicated the possibility of further pauses or reversals in production increases if necessary.
Saudi Arabia also adjusted prices for other regions, cutting $0.80 per barrel across all crude grades for Northwest Europe and the Mediterranean.
