Saudi Aramco offers more STS crude from Mideast Gulf

Market: Crude oil
22/09/26

Saudi Arabia's state-controlled Saudi Aramco has again offered refiners in Asia-Pacific spot crude originating from within the Mideast Gulf, after having sold around 56mn bl to buyers in the region since the shutdown of its East-West pipeline.

Aramco invited potential buyers in Asia-Pacific to bid for crude grades loading via ship-to-ship (STS) transfers in the Gulf of Oman, or for cargoes on a delivered basis, across September, October and November, according to sources familiar with the matter. It was unclear what grades would be available, but Aramco included Arab Light in its offers, sources added. The potential buyers were not given a fixed deadline to submit their bids. Some sources said that Aramco was offering 20mn bl in total, but this could not be directly confirmed.

Such spot offers are unusual because Aramco had historically only sold its crude on a term basis at the official selling price (OSP) that it sets monthly, but the producer had increased spot sales this year after the US-Iran war disrupted its customers' access to their term volumes.

The latest offers signalled Saudi Arabia's confidence in further reviving its crude exports through the strait of Hormuz, market participants said. Aramco had stepped up spot sales of crude exported through Hormuz after the outage of the key 7mn b/d East-West pipeline restricted Saudi crude shipments from the Red Sea. The firm recently sold at least 56mn bl of Arab Light, Arab Medium, and Arab Heavy to several buyers from Asia-Pacific, comprising mostly cargoes to be loaded via STS transfers near Fujairah or Sohar in September and October.

Aramco's trading arm also recently sold a rare cargo of Saudi-Kuwait neutral zone Khafji crude to an Indian refiner, which appeared to be the first spot sale of the medium sour grade since the effective closure of the strait of Hormuz in March.

By YouLiang Chay

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