SINGAPORE – Saudi Aramco has notified at least seven buyers across Asia that it would supply full contractual volumes of crude oil in October, though none of them asked for additional supplies despite deep price cuts, sources with knowledge of the matter said on Monday.
The full allocation comes as the Organization of the Petroleum Exporting Countries and their allies including Russia agreed to ease supply cuts by 400,000 barrels per day (bpd) each month between August and December.
“OPEC is still cutting by around 5 million bpd, but there seems to be plenty of oil from Saudi,” one of the sources said.
All sources spoke on condition of anonymity as they were not allowed to speak to the media.
Saudi Aramco declined to comment.
With rising supplies in view, Saudi Aramco has also slashed prices of all crude grades it sells to Asia in October by at least $1 a barrel to attract buyers.
Despite the deep price cuts, none of the seven buyers had asked for additional supplies, the sources said.
One source said spot crude prices remain attractive while another said they have purchased sufficient supplies from the spot market to meet their refining needs.
“Demand outside of China and India remains sluggish as a result of rising case counts,” Energy Aspects analyst Virendra Chauhan said.
Global oil price benchmark Brent climbed to their highest in a week on Monday, supported by tighter U.S. supplies and higher demand after Hurricane Ida damaged offshore production facilities.