The Commodities Feed: Oil prices edge up

The Commodities Feed: Oil prices edge up

The oil market has continued its recovery today, after Saudi Arabia increased official selling prices for all its grades to all regions for December. The price increments are much higher than market expectations and give a bullish signal on supply tightness. Aramco has increased the OSP of its flagship Arab light grade for Asian buyers by US$1. 4/bbl for December deliveries, to US$2. 7/bbl of premium over the benchmark. Similarly, Arab Light's premium for European and US buyers have been increased by US$2. 1/bbl and US$0. 5/bbl respectively for the month. OPEC's steady approach on the output increments at 400Mbbls/d per month and stronger oil demand in global markets appears to have contributed to the increase in prices. The US is reported to be exploring the option to release supply from Strategic Petroleum Reserves after OPEC+ resisted US calls to increase crude oil supply faster in response to the stronger demand. The Biden administration will be assessing the EIA's STEO (Short-Term Energy Outlook) data on Tuesday before deciding on the SPR release. Turning to China, oil imports into the country softened to around 8. 9MMbbls/d in October - compared to around 10MMbbls/d in September and largely on account of delays