Saudi Aramco just handed Asian buyers a $6-per-barrel discount on Arab Light crude for July. The official selling price now sits at $9.50 above the Oman/Dubai benchmark, down from June’s $15.50 premium.
The cut, announced on June 8, marks the second consecutive month of reductions for Aramco’s flagship grade. And it came in hotter than expected: a Bloomberg survey of refiners and traders had penciled in a $5 reduction, not $6.
What’s behind the cut
Every Saudi crude grade headed to Asia received an identical $6-per-barrel OSP cut for July. That’s not a surgical adjustment to one product line. That’s a blanket response to softening demand across the board.
Before the recent wave of geopolitical disruptions, primarily centered around the Strait of Hormuz and Iran-related conflicts, Saudi premiums to Asia were nowhere near the levels they’ve reached over the past several months. Even after two straight months of reductions, the $9.50 premium remains elevated by historical standards.
