Saudi Arabia May Significantly Lower August Crude Oil Prices for Asia

According to a report by Jinse Finance on June 26, a Reuters survey revealed that Saudi Arabia might significantly lower the official selling price (OSP) of crude oil for Asia in August to a four-month low, as the Middle Eastern spot crude oil market has sharply declined due to increased supply. Industry sources in the survey indicated that the flagship product, Arab Light crude oil, may see its August OSP set at a premium of $1.5 to $3 per barrel over the average Dubai/Oman quotes, which would be $6.5 to $8 per barrel lower than the July OSP. It is expected that the OSPs for other Saudi crude grades will experience a similar magnitude of reduction. Prior to this anticipated price cut, the Middle Eastern spot crude oil market has recently deteriorated significantly. The Dubai spot price spread turned into a discount of $1.64 per barrel this week, marking the lowest level in six years.