Informed sources said that Saudi Arabia, the world's largest oil exporter, reduced the price of its main Arab Light crude oil for Asian customers in January for the first time in 7 months. This coincides with weak premiums in the market amid fears of excess supply.
The sources said: According to Reuters, Saudi Aramco, the largest oil company in the world, reduced the official selling price of Arab Light crude for loading in January to Asia by 50 cents per barrel from December to $3.50 per barrel above Amman/Dubai prices.
A survey conducted by Bloomberg last week showed that Saudi Aramco is expected to reduce the price of its main oil crude to Asia for the first time since last June.
According to the average estimates in the survey, which included 6 refining and trading companies, Aramco is expected to reduce the official selling price of Arab Light crude by about $1.05 per barrel for January 2024 contracts compared to the previous month, and this will be the largest decline since February.
It is noteworthy that actual oil prices in Asia declined during the past month, and the price of Brent crude, which is considered a global standard, decreased by about 15% compared to the high price it reached in late September. Therefore, it is difficult for Saudi Aramco to maintain current oil price levels, according to the agency.
An official source in the Ministry of Energy announced, on November 30, that the Kingdom of Saudi Arabia will extend its voluntary reduction of one million barrels per day, which began in July 2023, until the end of the first quarter of 2024. This is in coordination with some countries participating in the OPEC+ agreement.
According to the source, the Kingdom’s production will be approximately 9 million barrels per day, until the end of March 2024, adding that in the context of supporting market stability, these additional reduction quantities will be restored gradually.
The source also indicated that this reduction is in addition to the voluntary reduction of 500,000 barrels per day, which the Kingdom previously announced in April 2023, and which extends until the end of December 2024.
