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Saudi Price Cut Sparks Demand Concerns

OIL

Brent crude has spent most of the Asia Pac session tracking lower. We were last near $77.90/bbl, which is back close to Friday session lows and down more than 1% for the session so far. The WTI front month benchmark is back under $73/bbl, off by a similar amount.

  • Demand concerns appear to be a key driver of today's weakness, following weekend news that Saudi Arabia cut its selling prices to all regions, including Asia (BBG). The drop for Asia was more than expected at $2 per barrel. This is likely renew demand fears for crude.
  • This overshadowing further concerns around Red Sea tensions and the risks of wider conflict in the Middle East. US Secretary of State Blinken will meet with key figures starting today in Abu Dhabi, including the U.A.E President and Saudi Crown Prince in a bid to avoid further escalation.
  • Broader risk aversion in the HK/China equity space hasn't sentiment either today, although it hasn't been a key driver of oil price weakness.
  • For Brent, current levels are close to the 20-day EMA, while the 50-day sits further north at $80.33/bbl. Recent lows rest under $75/bbl.
Energy BulletsCommodities
Energy BulletsCommodities

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