Global oil prices which were tracked by Brent futures have crashed to $71 per barrel, after Saudi Arabia’s oil giant, Aramco, cut prices for its Asian customers. According to a report yesterday, Aramco’s reductions for Asian buyers are deeper than expected.
This followed delay by the Organisation of Petroleum Exporting Countries in controlling production, which has added pressure to efforts to stabilize global oil prices.
Sources said that Aramco for January set the price of its key Arab Light crude grade at a premium of 90 cents per barrel above the regional benchmark.
They added that it has also reduced prices for markets in northwestern Europe and the Mediterranean but has kept prices for North America unchanged.
According to the report, in spite of these adjustments, Aramco maintains a dominant force in the global oil market, ranking as the fourth-largest company in the world by revenue, with an impressive $494 billion in 2024.
Recall that crude oil prices have dimmed nearly 9% from an October high of $80.35 per barrel, with Brent crude gasping to stay above $75 as OPEC downgraded its global oil demand forecast for the fourth time.
OPEC on October 14, reduced its 2024 global oil demand growth estimate to 1.93 million barrels per day (bpd), down from the previous forecast of 2.03 million bpd. It also lowered its 2025 demand growth forecast to 1.54 million bpd, down from 1.64 million bpd.
It was observed that since then, OPEC has struggled to keep global oil prices above $75 per barrel. It had been noted that since 2024, crude oil prices have managedto sustain a long-term upward trend, reflecting a prolonged market dip that has carried over from 2023.
Brent futures traded at $80.55 per barrel, early in the year buoyed by a modest uptrend that persisted through April. But bearish pressure started to mount in May, as Brent crude traded at higher volumes—6.4 million units—but failed to sustain its gains.
With the exception of a modest positive close in June, oil prices from July to September declined steadily, while it was $71.70 per barrel in September. However, inspite of momentary rise in October, OPEC’s revised forecast on October 14 pushed prices down to $71.89 by November 12.
