Reuters: Saudi Aramco opens crude taps wider for Asian buyers

At least five supertankers carrying around 10 million barrels of Saudi crude loaded at Ras Tanura have passed through the Strait of Hormuz, while Saudi Aramco has turned to spot pricing to accelerate sales in Asia, according to trade sources and shipping data cited by Reuters.

The state-owned energy giant has increased crude loadings and exports to Asia, contributing to an oversupplied prompt market that has pushed Brent crude down to about $70 a barrel from nearly $120 in March after the interim US-Iran peace agreement.

Alongside shipments delivered by its Bahri tanker fleet, Saudi Arabia has offered crude to Asian customers on a spot pricing basis in an effort to stimulate demand as competition among suppliers intensifies, several trade sources said. The sources declined to be identified because of the sensitivity of the matter.

Saudi Aramco, one of the last major Gulf producers to restart exports from within the Gulf, declined to comment.

The company usually markets its crude under long-term contracts using official selling prices (OSPs) announced each month. However, OSPs for July-loading cargoes destined for Asia, published in early June, carry premiums of $6 to $10 a barrel, while prices for other Middle Eastern crude shipments for July and August have moved to discounts as progress in US-Iran peace negotiations has reduced demand, with most refiners already covered through August.

One source said that 6 million barrels of crude loading in July had been offered to Saudi Aramco’s regular Asian buyers. Another source described the pricing as "very attractive" for Chinese customers.

Market participants expect Aramco to make significant cuts to its August OSPs.

By Jeyhun Aghazada