Saudi Arabia may raise official crude prices for Asia in November

Saudi Arabia may raise official crude prices for Asia in November

Top oil exporter Saudi Arabia may raise prices for most crude grades it sells to Asia in November on expectations for demand recovery and Chinese refineries to increase output following the issuance of new product export quotas.

The November official selling prices (OSP) for flagship Arab Light crude may rise by 25 cents a barrel, according to the median of the responses of five refining sources surveyed by Reuters on Sept. 29-30.

The backwardation in the Dubai market structure widened during trading last month, implying that demand for crude in the near term is rising. The premium for front-month Dubai over the price for the third month averaged $5.36 a barrel in September, up from $5.07 in August.

The market also expects China, the world’s biggest crude importer, to increase purchases as Beijing has issued a fresh round of refined product export quotas, totalling 15 million tonnes. That could encourage Chinese refineries to lift their crude buying to ramp up fuel output

Refining margins for gasoline and diesel plunged on China’s new export quotas as a flood of refined products would knock down the prices of the products.

The respondents polled by Reuters assess the price increase for Arab Medium and Arab Heavy to be