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Saudi Aramco decreases July crude supplies to 5 Asia buyers

Saudi Aramco decreases July crude supplies to 5 Asia buyers
Four refiners had smaller cuts in July when compared with June
SAUDI ARAMCO
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Riyadh - Mubasher: Saudi Aramco has reportedly decreased the July crude volume that it will supply to at least five Asian buyers, Reuters reported on Monday citing multiple sources.

The reductions were primarily made for the medium and heavy grade crudes and included refineries in countries such as China.

Four refiners had smaller cuts in July when compared with June, the sources added.

The move comes after OPEC and its allies including Russia agreed to extend oil production cuts by 9.7 million barrels per day (b/d), equivalent to 10% of the global demand, until the end of July.

However, Saudi Arabia revealed that it will end its larger voluntary cut amid signs of a recovering global demand.

Aramco has increased its official selling price (OSP) for July to Asia more than expected although refining margins and oil demand have not caught up yet with the rising crude valuations, backed by the low Middle East crude supplies and an improve appetite of crude refineries.

This has led at least one major Asian buyer to cut the contract volume for July by one-third, a source familiar with the matter said.

Two other sources said that they will reduce the purchase of the expensive Middle Eastern oil and will instead increase the purchase from different areas this month, such as West African crude and the US crude as they are priced at competitive levels.