Saudi Arabia has reduced its November prices for buyers to their lowest level in six years. It raised prices for northwest Europe and the Mediterranean.
Saudi Aramco set the selling price for Arab Light crude at $5 per barrel below Oman and Dubai prices. The discount marks a $3 reduction from October and represents the widest gap since June 2020.
The move surprised analysts because a Reuters survey had expected Saudi Arabia to raise the Asian price by up to $5 per barrel. Benchmark prices had increased, supporting expectations for a higher selling price.
Asian Oil Buyers Face Higher Shipping Costs
Aramco also reduced prices for Arab Medium and Arab Heavy crude sold to Asia by $5 per barrel. Three refining sources said the cuts could help buyers manage shipping expenses.
Freight rates have surged as regional disruptions affected crude shipments. LSEG data showed that hiring a crude carrier carrying two million barrels from the Gulf to China cost $1.2 million per day on Friday, compared with $80,000 a year earlier.
Meanwhile, people familiar with the matter said Aramco considered discounts for oil loaded from Oman. The company aimed to offset freight costs while protecting market share after disruptions linked to the US-Israeli war.
Saudi Oil Flows Adjust Amid Regional Disruptions
Lower prices could compensate buyers for longer voyages and delays affecting Saudi crude shipments from Egypt’s Sidi Kerir port. Since September, Aramco has moved millions of barrels through transfers outside Hormuz.
Additionally, Saudi Arabia resumed crude loading at Yanbu after a brief suspension following a drone attack on its East-West pipeline. In contrast, Aramco raised November prices for northwest Europe by $3 per barrel.
The company left prices unchanged for US buyers. The differing moves reflect varied strategies across key markets.
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