Saudi crude oil supply to China set to fall in Feb vs Jan, sources say

Saudi Arabia’s crude oil supply to China is set to decline in February from the month before, trade sources said on Thursday, after the kingdom hiked its prices and as OPEC+ extended production cuts in the first quarter.

State oil firm Saudi Aramco will ship about 43.5 million barrels to China in February, a tally of allocations to Chinese refiners showed, down from January’s 46 million barrels, a three-month high.

China’s state majors CNOOC and PetroChina and private refiner Hengli Petrochemical will be lifting less crude in February, while Saudi Aramco will increase its supply to Sinopec and Sinochem, they said.

Aramco declined to comment on its February allocation to China.

OPEC+, which pumps about half the world’s oil, decided in early December to push back the start of oil output rises by three months until April and extended the full unwinding of cuts by a year until the end of 2026 due to weak demand and booming production outside the group.

With tighter supply, Aramco has also increased official selling prices to Asia for the first time in three months.

Earlier this week, it raised the official selling price (OSP) for flagship Arab Light crude by 60 cents to $1.50 per barrel above the Oman/Dubai benchmark average, slightly above market expectations.

Asian refineries, chiefly China and India, are looking to buy more Middle East grades after wider sanctions by Western countries tightened supplies and pushed up the prices of Russian and Iranian oil.

Saudi Arabia is the No. 2 crude supplier to China after Russia.

China’s crude imports from Saudi Arabia totalled 72.27 million tons (1.44 million barrels per day) for the first 11 months of 2024, down 9.6% from the same period a year earlier, Chinese customs data showed in December.

Source : Reuters