S. Arabia to reduce crude oil supply to China in Feb

Saudi Arabia’s crude oil shipments to China are set to decline in February as higher prices and extended OPEC+ production cuts tighten supply. Saudi Aramco will supply approximately 43.5 million barrels to Chinese refiners, down from January’s three-month high of 46 million barrels, according to trade sources.

While state-owned firms CNOOC and PetroChina and private refiner Hengli Petrochemical will receive less crude, allocations to Sinopec and Sinochem are expected to rise. Aramco declined to comment on February’s allocations.

OPEC+ extended production cuts until the end of March and postponed planned output increases to April, citing weak global demand and rising production outside the group. In response to tighter supply, Aramco raised the official selling price (OSP) of Arab Light crude to $1.50 per barrel above the Oman/Dubai benchmark, marking the first increase in three months.

Saudi Arabia remains China’s second-largest crude supplier after Russia, with imports totalling 72.27 million tons in the first 11 months of 2024, down 9.6 per cent year-on-year, according to Chinese customs data.

Attribution: Bloomberg

Subediting: M. S. Salama