Saudi Aramco cuts crude prices to Asia as India pulls away from Russian crude

SaudiAramco cut its December official selling price to Asia by roughly USD 1.2-1.4 / bbl from its November pricing, with its flagship Arab Light priced at USD 1 / bbl above Oman/Dubai benchmarks, Reuters reports. The cuts aim to defend the Saudi oil giant’s market share and sales volumes amid uncertainty around sanctioned Russian flows, as Indian refiners are scaling back on Rosneft and Lukoil-linked barrels.

Indian refiners may step up Gulf purchases: In a continuing bid to diversify away from Russia, Reliance Industries lifted its Saudi intake by 87% month-on-month in October, Businessworld reports. With more attractive December pricing, Indian state-run refiners are likely to follow suit. This could intensify competitive pressure across the region, which is already fearing a supply glut.

Also shaping the bigger picture: Russian Ural crude is now trading at the lowest price in a year, at about USD 4 / bbl below Brent, as Indian and Chinese refiners pull back after US sanctions on Rosneft and Lukoil, Reuters reports. Indian refiners — including Hindustan Petroleum Corp, Bharat Petroleum Corp, Mangalore Refinery and Petrochemicals, HPCL-Mittal Energy, and Reliance Industries — have hit pause on December orders of Russian oil, the newswire added. Together, these refiners account for c.65% of India’s imports of Russian oil.

Weakening Asian demand could further erode Russia’s fiscal strength ahead of President Putin’s India visit, as Washington ramps up pressure on both New Delhi and Beijing to dump Russian crude. Chinese state oil firms have also halted seaborne Russian purchases — non-sanctioned barrels trade at premiums while sanctioned cargoes are heavily discounted, the newswire added.