Saudi Arabia is set to boost crude exports to China in October to around 51 million barrels—about 1.65 million barrels a day—after slashing its official selling price for Arab Light to Asia by $1 to $2.20 per barrel above Oman/Dubai. The move, the sharpest cut since spring, has already drawn stronger allocations from refiners such as Sinopec and Hengli, lifting October flows well above September levels and matching April 2023 highs.
The pricing reset followed OPEC+’s weekend decision to lift output by 137,000 barrels a day in October, part of a gradual supply unwind led by Saudi Arabia and Russia. Analysts expect the group’s production increases, combined with resilient non-OPEC supply, to push the global oil market into a surplus of nearly 1.7 million barrels a day in the fourth quarter, intensifying the need for Riyadh to defend market share rather than prices.
At the same time, Europe is wrestling with a politically sensitive energy pact with Washington that envisages up to $750 billion in purchases of US energy and nuclear fuel. Critics within the EU question both the cost and dependence implied by the framework. For Saudi Arabia, this uncertainty may present new openings in Europe’s medium-sour crude market, though Asia remains its primary battleground.
Looking ahead, Saudi Arabia’s Q4 strategy is clear: anchor barrels in Asia through competitive pricing while keeping optionality in Europe as US-EU energy ties come under review. With global balances tipping into surplus, Riyadh’s discipline will be tested, but early moves in October suggest it is prioritising volume security over near-term premiums.
