• 3 minutes This Battery Uses Up CO2 to Create Energy
  • 5 minutes Shale Oil Fiasco
  • 9 minutes Don't sneeze. Coronavirus is a threat to oil markets and global economies
  • 12 minutes Historian Slams Greta. I Don't See Her in Beijing or Delhi.
  • 20 hours Boris Johnson taken decision about 5G Huawei ban by delay (fait accompli method)
  • 1 day Governments that wasted massive windfalls
  • 1 day We're freezing! Isn't it great? The carbon tax must be working!
  • 7 hours Which type of Hegemony will China follow
  • 1 day Here is Why People Lose Money Trading Natural Gas
  • 13 hours Tesla Will ‘Disappear’ Or ‘Lose 80%’ Of Its Value
  • 1 day Let’s take a Historical walk around the Rig
  • 1 day US Shale: Technology
  • 1 day 2nd Annual Great Oil Price Prediction Challenge of 2019
  • 1 day Trump capitulated
  • 2 days Trump has changed into a World Leader
  • 2 days Beijing Must Face Reality That Taiwan is Independent
Irina Slav

Irina Slav

Irina is a writer for Oilprice.com with over a decade of experience writing on the oil and gas industry.

More Info

Premium Content

Saudi Arabia Slashes Crude Price To Asia

Saudi Arabia has decided to offer Asian customers the biggest discount in 10 months for its crude, as the kingdom’s refineries struggle with an oversupply thanks to record-high output.

Aramco has priced its September shipments, which it announced on Sunday, to the continent at US$1.10 below the Asian benchmark. This is US$1.30 lower than the price for August shipments and 10 cents lower than estimates made by refiners and commodity traders polled by Bloomberg.

Aramco’s decision represents the latest move in what is shaping up to be a long battle between OPEC’s number-one and its biggest rival at the moment: Iran.

After in June this year Saudi Arabia raised prices for Asian customers on optimism about returning demand, which proved to be short-lived, it is now coming to terms with a reality of not just weak demand but higher competition, as Iran is fast ramping up its exports. The main destination of these exports is Asia.

Yes, Asia is no longer the oil-hungry giant it used to be. There is more than enough local supply and refineries in the region are reducing their operating rates as margins fall. Even China’s teapots, which were seen as the most promising new destination for both Saudi and Iranian crude, are cutting down production to as much as 50%, according to data from Oilchem.net cited by Bloomberg.

The market that Saudi Arabia has been flooding with oil in a bid to maintain its top position in exports is changing, and challenges abound for the Saudis, not just within OPEC but outside it, too. Just last week Pioneer Resources CEO Scott Sheffield said the company has achieved production costs of just US$2 per barrel in some of its shale plays, making this oil very competitive to the Saudi light crude.

By Irina Slav for Oilprice.com

More Top Reads From Oilprice.com:




Download The Free Oilprice App Today

Back to homepage




Leave a comment

Leave a comment




Oilprice - The No. 1 Source for Oil & Energy News
Download on the App Store Get it on Google Play