Saudi Aramco Cuts November Arab Light to Asia by $3 to 6-Year Low
Aramco set its November official selling price for Arab Light crude to Asian customers at $5 per barrel below the average of Oman and Dubai benchmarks, a reduction of $3 from the previous month and the widest discount since June 2020. A Reuters survey of traders and analysts conducted before the announcement had expected increases of up to $5 a barrel. Multiple outlets described the cut as unexpected.
The price reduction appeared intended partly to offset buyers’ higher freight costs. VLCC charter rates from the Persian Gulf to China reached approximately $1.2 million per day in early October, compared with roughly $80,000 a day a year earlier, according to LSEG data cited by Reuters.
Freight Costs and Fiscal Data
Three Asian refining sources told Reuters the price reduction appeared intended partly to offset buyers’ higher freight costs. VLCC charter rates from the Persian Gulf to China had reached approximately $1.2 million per day in early October, compared with roughly $80,000 a day a year earlier, according to LSEG data cited by Reuters.
Regional Pricing and Discounts
Aramco reduced prices across all five crude grades shipped to Asian term-contract buyers. The cuts ranged from $3 per barrel on Arab Light and Arab Extra Light to steeper reductions on the heavier grades that compete most directly with Iraqi and Kuwaiti barrels in Asian refining slates.
November 2026 Aramco Official Selling Prices for Asia (vs Oman/Dubai average) Grade OSP ($/bbl) Arab Super Light -3.35 Arab Extra Light -4.50 Arab Light -5.00 Arab Medium -6.00 Arab Heavy -7.35
Source: Argaam, October 5, 2026.
While Asian buyers received across-the-board cuts, Aramco raised prices for northwest Europe and the Mediterranean by $3 per barrel on all grades, according to Argaam. Arab Light to northwestern Europe was set at $0.85 above ICE Brent, and Arab Light to the Mediterranean at $0.65 above the same benchmark. North American prices were unchanged, with Arab Light held at $4.60 above the Argus Sour Crude Index, Egypt Oil & Gas reported.
Market Expectations and Dynamics
Before the announcement, physical demand for Saudi crude in Asia pointed toward tighter pricing. Chinese refiners had secured at least 80 million barrels of Saudi crude for September-to-November loading through spot trades since mid-September, according to Kpler. China’s onshore crude stocks fell at a record pace of approximately 1.6 million barrels per day in September — the fastest drawdown the consultancy had recorded, surpassing a previous high of 950,000 barrels per day in October 2017.
Shell CEO Wael Sawan told Bloomberg in October that Middle Eastern crude flows had recovered to about 80% of prewar levels. Aramco offered approximately 40 million barrels of November-loading crude on the spot market, and buyers took roughly half, Kpler reported. Those dynamics — recovering supply, depleting inventories, strong spot demand — were the basis for the analysts’ forecasts of a price increase in the Reuters survey.
The gap between the survey’s expected price hike and the actual cut has raised questions about the sustainability of the current market structure.
Original Article: Aramco Cuts November Arab Light to Asia by $3 to 6-Year Low — Houseofsaud