Saudi Aramco, the world’s largest state oil company, will cut Arab Light crude oil exports to Asia for the first time in at least three months as part of an overall supply reduction to the region.
The Dhahran, Saudi Arabia-based oil producer will lower shipments starting in June, said three refinery officials who received notices and asked not to be identified because of confidentiality agreements. The producer has been reducing Arab Medium and Arab Heavy sales by between 9 percent and 10 percent of total contracted volumes.
Saudi Aramco’s supply cuts in the past few months were focused on its Arab Heavy grade that mostly yields fuel oil during processing. Saudi Arabia is lowering exports to comply with 1.7 million-barrel-a-day production cuts agreed last year by the Organization of Petroleum Exporting Countries.
The company has trimmed shipments below contract levels since November. Saudi Aramco lowered exports to Asian refiners in April by an average 9 percent, and the cuts this month and in June are more than the 7 percent reduction in March shipments.
It’s the eighth month that Saudi Aramco has reduced exports to Asia.
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