Saudi Crude to China to Surge in May after Price Fall, Sources Say

SEATTLE (Oil Monster): Saudi Arabia's crude oil supply to China will surge in May from the prior month as a sharp price cut by the kingdom attracted more demand, sources said on Friday.

State oil firm Saudi Aramco will ship about 48 million barrels to China in May, a tally of allocations to Chinese refiners showed, up from April's 35.5 million barrels.

The figure marks the first increase since the beginning of this year in Aramco's allocation to China.

Chinese state major Sinopec, China National Offshore Oil Corp and private refiner Shenghong Petrochemical will all be lifting more Saudi crude in May, the sources said.

Aramco did not immediately respond to an email seeking for comment on its May allocation.

On Sunday, Aramco cut the May official selling price (OSP) for flagship Arab Light crude to $1.20 a barrel above the average of Oman and Dubai prices, down $2.30 from the April OSP.

That's a four-month low for the premium over the Oman and Dubai prices and also close to the lowest in four years. The reduction in the premiums follows a surprise decision by OPEC+ to boost output by 411,000 barrels per day in May, triple the expected increase.

Saudi Arabia is the second largest crude supplier to China after Russia.

Courtesy: www.reuters.com