Key Takeaways
- Several Asian refiners bought 12 million barrels of Saudi crude in the spot market.
- Sales were made through a tender issued by Saudi Aramco and private negotiations.
- Saudi Arabia shifted to spot sales to move more oil out of the Strait of Hormuz.
Several Asian refiners have purchased 12 million barrels of November Saudi crude in the spot market, according to sources with knowledge of the matter. The purchases were made by both state-owned and independent refiners in China.
The sales were facilitated through a tender issued by Saudi Aramco and through private negotiations, with some of the delivered crude priced at a premium of about USD20 a barrel to November official selling prices (OSPs).
Two sources stated that Saudi Arabia has also sold oil for November-loading to refiners in India and Taiwan, also on a delivered basis.
The shift to spot sales was prompted by security concerns in the Strait of Hormuz, where buyers had refrained from chartering ships due to the ongoing Iran conflict, according to the sources.
Saudi Arabia typically releases its OSPs at the beginning of each month and asks term buyers to nominate monthly volumes. However, this month, it has opted for spot sales to move more oil out of the strait.
The move is part of Saudi Arabia's strategy to diversify its oil sales and reduce dependency on the Strait of Hormuz, a critical transit point for global oil supplies.
Saudi Aramco did not immediately respond to a request for comment on the matter.
