SINGAPORE: Saudi Arabia’s crude oil exports to China are set to fall in November to about 40 million barrels as refiners are expected to switch to cheaper spot supply from other Middle East producers, several sources with knowledge of the matter said on Friday.
That would be down from the expected surge of 51 million barrels of crude exports in October from the world’s top oil exporter to the world’s top importer.
On Monday, state oil company Saudi Aramco left the official selling price of its flagship Arab Light crude to Asia unchanged in November, against market expectations of a price hike, a day after OPEC+ agreed to a modest increase in oil production.
However, Middle East crude benchmarks Dubai and Oman are currently trading more than $1 below their average last month, Reuters data shows, making spot cargoes more attractive for Chinese buyers rather than supplies under long-term contracts, the sources said.
Middle East crude supply is set to rise further as the Organization of the Petroleum Exporting Countries and their allies, known as OPEC+, decided on Sunday to increase oil output by 137,000 barrels per day (bpd) in November.
The volume is on par with the planned hike in October as the group remains cautious amid ongoing concerns about a potential oversupply in the market. Reuters
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