Oil Falls After Saudi Arabia Cut The Price of Crude

Oil prices fell more than 1% on Monday (September 7th) after hitting the lowest level since July, after Saudi Arabia announced the largest monthly price cut for supplies to Asia in five months, while optimism about a recovery in demand dwindled amid the pandemic.

Brent crude was $ 42.11 a barrel, down 55 cents, equivalent to 1.3% by 06:42 GMT, and earlier it fell to 41.51, the lowest level since July 30.

US West Texas Intermediate crude fell 64 cents, or 1.6%, to $ 39.13, after earlier dropping to $ 38.55, its lowest level since the tenth of July.

A global glut of crude and fuel remains despite production cuts by OPEC and its allies in what is known as OPEC+ and governments’ efforts to stimulate the global economy and demand for oil. Refiners have cut fuel production as a result, prompting producers, including Saudi Arabia, to lower prices to cope with declining demand for crude.

China, the world’s largest importer of crude, backed prices with record purchases, but imports slowed in August while exports of products rose, according to customs data today.

Saudi Arabia, the world’s largest crude exporter, lowered the official selling price for Arab Light crude in October, which is the crude it sells to Asia, by the largest amount since May, in an indication that demand remains weak. Asia is the largest market for Saudi crude in terms of regions.