Macca, Dec. 10, 2024 – Saudi Aramco, the world’s largest crude oil exporter, cut its January 2025 prices for Asian buyers to its lowest level since early 2021, the company said this weekend, amid weakening demand from China.
Aramco cut the price for its flagship crude by 80 cents, to just 90 cents per barrel over the Oman/Dubai benchmark average.
Last time prices were this low, oil markets were still grappling with the demand hit from the coronavirus pandemic.
The cut follows a decision by OPEC+ last week to extend production curbs into the first quarter of 2025.
Aramco also cut prices for European consumers but kept those for the United States steady.
The lower prices should make Saudi crude more competitive in Asia against rival Russia and the United States, allowing it to win back market share.
It can also be seen as underscoring concerns about demand, particularly from China.
Asia’s imports for the first 11 months of 2024 were26.28 million barrels per day, down 310,000 bpd from the same period in 2023.
Meanwhile, oil markets could face new uncertainty following the ouster of Syrian President Bashar al-Assad over the weekend by rebels, which ended the 50-year family dynasty rule.
Although Syria is by no means a major player in the oil market, the event creates more instability in the region, which is already facing an ongoing conflict since the start of the Israel-Gaza war in 2023.
Al-Assad’s exit will shatter Iran’s influence in the Middle East and bolster the risk that extremist groups take over amid a power vacuum.
Assad’s allies had included Tehran and Moscow, which had helped prop up his 13-year rule with military support. (Reuters)
