Saudi Oil Market Fight Shifts to U.S. as Asia Prices Rise

04-Dec-2014

Saudi Arabia’s increase in crude prices for Asia signals the world’s biggest oil exporter is focusing its fight for market share on the U.S.

While Saudi Arabian Oil Co. boosted differentials for supplies to Asia next month after cutting some November prices to the lowest in almost six years, American buyers will get another month of reductions. The Middle East producer isn’t prepared to surrender sales in the U.S., where a shale boom has lifted output to the highest in more than 30 years, according to Idemitsu Kosan Co., Japan’s third-largest refiner, and Elements Capital Inc., a Tokyo-based hedge fund that focuses on energy. Global oil prices slid into a bear market last month on speculation the biggest OPEC producers were discounting their crude to maintain market share, resisting calls to cut output amid slowing demand growth. West Texas Intermediate futures resumed the slide today, slumping to the lowest in three years, on signs the Saudis are prepared to go even lower to shore up U.S. demand.

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