Saudi Arabia cut crude oil export prices to Asia and Europe by nearly $4 per barrel on Tuesday, the first cut in four months, according to the country’s state oil company Saudi Aramco.
Meanwhile, US buyers will pay around $0.50 more for Saudi oil. The company’s Arab light crude price will remain unchanged. The move followed a fall in Brent crude futures in the last three months to below $95 per barrel.
The world’s leading oil exporter increased its official selling price for September to a record high of $10.95 per barrel for Arab Extra Light against the Oman/Dubai average and $9.80 per barrel for Arab Light.
Asia exports the majority of Saudi Arabia’s oil. The top four buyers are China, Japan, South Korea, and India. Despite signs of a weakening in several major economies, the global market remains tight.
The Organisation of Petroleum Exporting Countries and their allies, collectively known as OPEC+, announced on Monday that it would reduce production by 100,000 barrels per day in October.
Oil prices fell on 6 September amid recession fears after jumping up in reaction to the OPEC+ output deal. Brent crude sank 3.2% to $96.22 per barrel, while West Texas Intermediate fell 0.2% to $86.69 per barrel.
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In an interview last month, Saudi Energy Minister Prince Abdulaziz bin Salman stated that the futures markets are giving “a false sense of security at periods when spare capacity is severely constrained and the potential of serious disruptions remains high”.