Asia buyers receive full volumes of October Saudi crude

Several Asia-Pacific refiners have nominated contractual volumes of October-loading term crude from Saudi Arabia's state-controlled Saudi Aramco and will receive what they requested.

Five refiners in Asia-Pacific said they will receive their full allocations of October-loading Saudi crude from Aramco. They added that they had requested normal contractual crude volumes for October loading, after Aramco slashed the official October formula prices for its crude exports to the region to their lowest levels in four months.

Saudi Arabia had reduced allocations for refiners in Asia-Pacific in recent months, while some term buyers had also nominated lower volumes for September-loading crude last month after Aramco had raised its September formula prices by higher than anticipated.

Aramco may have provided regional refiners with their requested volumes of October-loading crude to compensate for tighter Abu Dhabi crude supplies, Asia-Pacific traders said, after Abu Dhabi's state-owned Adnoc announced deep nomination cuts for its October and November crude exports. The 30pc reductions for October-loading term cargoes have so far been the deepest nomination cuts that Adnoc has put in place since it started reducing allocations for May-loading crude.

Under the terms of the Opec+ production cut agreement, which required Riyadh to curb output at 8.49mn b/d over May-July, Saudi Arabia can increase production to 8.99mn b/d over August-December. Saudi production rose by 430,000 b/d from the previous month to 8.87mn b/d in August, as the alliance eased its output restraint target.

But October-loading Saudi crude deliveries to Europe and the Mediterranean are scheduled to remain limited, after official regional prices failed to stimulate demand.

By Fabian Ng