Saudi Arabia Keeps Dec Arab Light Crude Oil Price to AsiaSteady from Nov
11.06.2023 By Tank Terminals - NEWS

November 6, 2023 [Reuters]- Saudi Aramco has kept its December Arab Light grade official selling price (OSP) for Asian customers unchanged from the prior month, pausing a five-month price hike cycle, a company statement showed on Monday.

 

The Middle Eastern oil kingpin set the OSP for Arab Light at $4 a barrel over the Oman/Dubai average, the same premium as November.

The price change for the Saudi flagship grade is in line with market expectations, as refiners weighed weak oil processing margins and supply uncertainties.

Top oil exporters Saudi Arabia and Russia confirmed on Sunday they would continue with additional voluntary oil output cuts until the end of the year as concerns over demand and economic growth continue to weigh on markets.

Both countries said their cuts would be reviewed next month to consider extending, deepening or increasing them.

On December OSPs, Saudi Aramco raised Arab Extra Light (AXL) crude price to Asia by 70 cents to $4.05 a barrel over Oman/Dubai quotes, a third monthly increase, underpinned by strong light sour crude prices in the spot market.

“Such big price hike on AXL is really unexpected,” said a Singapore-based oil trader.

Saudi Aramco typically takes cues from the structure of light sour benchmark Murban when setting prices for AXL. Last month, spot premiums for Murban averaged at $3.88 a barrel over the Dubai quotes, up 45 cents from September.

Market participants expect Middle Eastern light sour grades to face growing competition from arbitrage cargoes in Atlantic Basin and America, following a narrower spread between Brent- and Dubai-pegged crude.

For other regions, Saudi Aramco cut its December Arab Light OSP to northwest Europe by $2.30 a barrel to $4.90 a barrel above ICE Brent.

Meanwhile, the OSP of Arab Light to the United States was unchanged at $7.45 versus ASCI in December.

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