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The Kingdom cut its crude oil prices to October to customers in Asia, Europe and the US this week, the Financial Times has reported.
State-owned Saudi Aramco reduced prices for its main oil export grade Arab Light to Asia by US $1.70 a barrel to October from September- a discount of 5 cents a barrel to the Oman-Dubai benchmark.
Meanwhile prices to the Mediterranean fell by 95 cents a barrel, to a discount of US $3.20 against the Brent benchmark, the FT has reported.
The same grade by 40% for the US and 70% for the northwest of Europe to the Argus Sour Crude Index and Brent benchmarks.
Overall prices in all four regions haven’t been so low since November 2010. Heavier grades also posted decreases.
Saudi Arabia has lost significant crude oil market share to Iraq and Iran with the two countries discounting their crude in recent months, while aiming to compete with Kuwait and the UAE.
“While the cuts were widely expected, the magnitude took a few in the market by surprise,” said Amrita Sen, at London-based consultancy Energy Aspects, for the FT.
“For the Saudis, market share has really become an issue over the last year, so this is a signal that they are not just going to cut production because they have done so in the last few years,” she added.
