Saudi Aramco has offered spot crude cargoes to European refiners for October and November loading, Bloomberg reported on Tuesday. Some October cargoes came at a discount to Aramco’s official selling price. Also, buyers can lift them at Yanbu on the Red Sea or Sidi Kerir in Egypt.
Why Aramco spot crude is back
Earlier this month, Aramco told European refiners they would get no October term cargoes. That was because an attack had shut the East-West pipeline, which feeds Yanbu. Now the pipeline is running again. As a result, refiners will also receive their full November term volumes.
Saudi Arabia normally ships 0.7-0.8mmbbl/d of crude to Europe, mostly under term deals. So, the October cuts had pushed refiners into the spot market. Now the extra Saudi supply has already lowered prices for some European grades, traders said.
Gulf supply recovers
Meanwhile, Saudi output rose by a third in September to over 8mmbbl/d. In addition, the UAE pumped at a record high, while Iraqi exports neared pre-war levels. For context, read our report on the pipeline attacks.
For a deeper analysis, read: Aramco Spot Crude for Europe: Why Saudi Pricing Now Puts Market Share First
