Saudi Aramco Offers Spot Crude to Europe as Key Pipeline Resumes Operations

Saudi Aramco has offered spot cargoes of crude oil to European buyers for October and November delivery, a move that signals a normalization of supply after a key export pipeline resumed operations, according to a Bloomberg report on Tuesday.

Spot Offers Follow Disruption

The state-owned oil company reportedly offered cargoes for late-October loading earlier this month, followed by additional supplies for November lifting last week. The report noted that the October cargoes were sold at a discount to Aramco's official selling price (OSP).

Buyers can take delivery from either the Sidi Kerir port in the Mediterranean or the Yanbu port on Saudi Arabia's Red Sea coast. The offers aim to fill a supply gap created by an earlier disruption.

Reversal of October Halt

Previously, Aramco had informed European refiners that they would receive no crude oil under their long-term contracts for October. This was due to an attack that temporarily shut down the crucial East-West pipeline, which feeds the Yanbu export terminal.

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With the pipeline now back in service, Aramco is increasing its exports. The company has also reportedly informed its European customers that they will receive their full contractual volumes for November. The increased availability of Saudi supply has reportedly contributed to a drop in the prices of some European oil products this week.

Broader Supply Context

Saudi Arabia typically exports 700,000 to 800,000 barrels per day (bpd) to Europe, with the majority supplied through long-term contracts, according to ship-tracking data compiled by Bloomberg. The prior uncertainty had pushed European refiners to seek more purchases on the spot market.

The development comes as Middle Eastern oil exports recover. Saudi Arabia's own production rebounded by a third in September to over 8 million bpd after hitting a more than three-decade low the previous month. According to the International Energy Agency, the UAE's output has reached a record high, and Iraqi exports are approaching pre-conflict levels.