Key Takeaways:
Saudi Aramco has loaded at least five supertankers carrying 10 million barrels of crude from Ras Tanura, resuming exports from the world's largest oil port after a four-month halt and switching to spot pricing to accelerate sales to Asian buyers.
Saudi Aramco resumed crude loadings from Ras Tanura on Friday after a halt of nearly four months, loading five very large crude carriers with 10 million barrels and offering the crude to Asian customers on a spot pricing basis, according to trade sources and shipping data.
"These spot sales are highly unusual for Aramco, which typically sells crude through long-term contracts at official selling prices set monthly," said a Singapore-based crude trader with knowledge of the matter, asking not to be named due to the sensitivity of the transactions. "The pricing was very attractive for Chinese buyers," another trader said.
Two of the VLCCs that exited the Strait of Hormuz are heading to Japan, while another two are making their way to China, shipping data from LSEG and Kpler showed. Sinochem's Quanzhou refinery will receive 2 million barrels, and another 2 million barrels is heading to Lianyungang port, where Shenghong Petrochemical is located. Another four VLCCs are near Ras Tanura, with three waiting to load and one fully laden.
The resumption adds to a prompt glut that has depressed Brent crude to about $70 a barrel from close to $120 in March following the interim U.S.-Iran peace deal. Aramco's official selling prices for July-loading cargoes to Asia are at premiums of $6 to $10 a barrel, while other Middle Eastern grades for July to August have fallen to discounts, pressuring the producer to cut its August OSPs sharply, traders said.
Spot Pricing Signals Aggressive Market Share Push
Aramco typically sells oil through long-term contracts at official selling prices set every month. The shift to spot pricing — offering at least 6 million barrels of July-loading crude to its usual Asian customers — marks a strategic pivot as competition among Gulf producers intensifies. The purchased shipments will count toward customers' annual contractual volume obligations with Aramco, traders said.
The UAE's Abu Dhabi National Oil Co. has been among the most active sellers of spot crude from the region, selling tens of millions of barrels via spot tenders and proposing this week to index its own official prices to the Dubai benchmark. Across the Middle East, producers have been ramping up output, helping prices of regional crudes to collapse.
Ras Tanura's Return Reshapes Supply Dynamics
Ras Tanura, on Saudi Arabia's eastern coast west of the Strait of Hormuz, exported more than 5 million barrels per day of crude before the U.S. and Israel started the conflict by attacking Iran. Aramco shut its largest 550,000-barrel-per-day refinery at the port during the war as a precautionary measure.
The last time Gulf producers faced a similar supply disruption, the recovery in exports took roughly three months to normalize, with spot premiums eroding as cargoes returned to market. Traders now expect Aramco to cut its August OSPs sharply, with some forecasting discounts of $1 to $2 a barrel versus the Oman/Dubai benchmark to compete with rival grades.
This article is for informational purposes only and does not constitute investment advice.
