Saudi Arabia Slashes December Oil Prices to Defend Market Share in Asia

Core Viewpoint - Saudi Arabia has significantly reduced its official selling price (OSP) for crude oil to Asia in December, following the OPEC+ decision to halt output increases in early 2026 [1][3]. Group 1: Price Adjustments - Saudi Aramco will sell its "Arab Light" grade to Asian buyers at a premium of $1.00 per barrel above the Oman/Dubai average for December, a decrease of $1.20 from November [2]. - The Arab Medium and Arab Heavy grades were each cut by $1.40 to premiums of $0.05 and $0.10 per barrel, respectively, while the Arab Extra Light grade saw a drop of $1.20 to a premium of $1.30 per barrel [2]. Group 2: Market Dynamics - The price adjustments reflect a well-supplied Asian market with increasing crude volumes and Saudi Arabia's aim to maintain competitiveness and market share [4]. - The price cut provides a more attractive feedstock cost for Asian refiners, potentially stimulating increased term nominations or spot buying of Saudi crude [5]. Group 3: Demand and Supply Outlook - Traders are closely monitoring demand from Asian refiners for December, particularly whether spot flows of Saudi barrels will increase [6]. - The lower premium also indicates concerns about future demand and the risk of oversupply in the market [5].