Saudi Arabia will downgrade key to buyers in all regions, including its main Asian market, in February due to continued market weakness
*Consumption typically eases in February and March, with refineries using this time to shut down some facilities for scheduled maintenance. At the same time, strong global**, including the United States, has increased the likelihood of a surplus, forcing the OPEC+ group, led by Saudi Arabia and Russia, to extend production cuts until this year.
State-owned producer Saudi Aramco cut its flagship Arab Light*** in Asia by $2 to $1 per barrel above the benchmark**$50. That's more than the Bloomberg survey of refiners and traders estimated at 1The drop of $25 is even greater. Aramco also lowered all February deliveries to Northwest Europe, the Mediterranean and North America.
In 2023, for the first time since 2020, the world will be. So far, the market has shrugged off concerns about the Israeli-Hamas conflict and heightened instability in the Middle East. Houthi attacks on merchant ships passing through the Red Sea have not yet been disrupted.
OPEC+ production cuts are also aimed at preventing an increase in stockpiles amid fears that a weaker economy will dampen global demand. Saudi Arabia is taking on most of the burden, voluntarily cutting production by 2 million barrels per day in the first quarter and beyond. (Compiled by Xiao Chen).
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