Saudi Aramco’s Price Cuts and Increased Oil Supply: What It Means for Investors and Businesses in the Energy Sector
SINGAPORE: Saudi Aramco, the leading oil exporter, has urged its Asian buyers to increase crude oil purchases in October following larger-than-expected price reductions across all grades, according to three sources familiar with the situation.
In an effort to regain market share, Aramco engaged with Asian buyers on the sidelines of this week’s APPEC conference in Singapore, encouraging them to secure higher volumes of crude for October. This discussion has contributed to a delay in the allocation of October supplies to customers, which may now be announced next week, one source revealed. Aramco has not responded to requests for comment.
On Monday, the Saudi state oil company set the October price for its flagship Arab Light crude to Asia at $2.20 per barrel above the Oman/Dubai average—a $1 decrease from the five-month high price in September.
This price adjustment follows OPEC+’s recent decision to increase production by 137,000 barrels per day in October. Since April, the group has raised production targets by 2.5 million barrels per day. Analysts interpret this strategy as OPEC+ prioritizing market share, even if it means accepting softer prices.
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Saudi Aramco’s deeper-than-expected price cuts and push for higher crude volumes signal a strategic shift towards aggressive market share capture amid rising supply. For Omani businesses, this heightens competitive pressure on pricing but also opens opportunities in downstream sectors and refining, where cost advantages can be leveraged. Smart investors should monitor OPEC+ production policies closely and consider diversifying portfolios to mitigate risks from volatile oil prices.
