By Siyi Liu and Florence Tan
SINGAPORE (Reuters) – Saudi Arabia’s crude oil supply to China is set to slide in March from the prior month, trade sources said on Tuesday, after the kingdom hiked its prices to the highest in more than two years.
State oil firm Saudi Aramco will ship about 41 million barrels to China in March, a tally of allocations to Chinese refiners showed, down from February’s 43.5 million barrels. The figure marks a second consecutive monthly drop of Aramco’s allocation to China.
Chinese state major Sinopec and Aramco’s joint venture Fujian refinery will be lifting less crude in March, while Aramco will increase its supply to PetroChina and private refiner Shenghong Petrochemical, the trade sources said.
Aramco declined to comment on its March allocation.
Last week, Aramco sharply increased crude prices for March shipments to buyers in Asia and other parts of the world.
It raised the official selling price for flagship Arab Light crude by $2.40 to $3.90 per barrel above the Oman/Dubai benchmark average, the highest since December 2022.
The price hike came after the latest U.S. sanctions widely targeting Russian energy trade disrupted Russian supply and boosted shipping costs.
OPEC+, which pumps about half the world’s oil, is likely to maintain production cuts in the first quarter and to raise output gradually from April, delegates to the producer group’s meeting last week told Reuters.
Saudi Arabia is the No. 2 crude supplier to China after Russia.
China’s crude imports from Saudi Arabia totalled 78.64 million metric tons (1.57 million barrels per day) for 2024, down 8.5% from 2023, Chinese customs data showed.
(Reporting by Siyi Liu and Florence Tan in Singapore; Editing by Tom Hogue, Jamie Freed and Kate Mayberry)
