Oil Extends Slide on Saudi Price Cut 

Oil Extends Slide on Saudi Price Cut Oil Extends Slide on Saudi Price Cut 

West Texas Intermediate (WTI) on Monday dropped to the lowest level in more than two years after Saudi Arabia reduced the cost of its oil to US customers in the face of soaring North American output, Bloomberg said in a report.

Futures tumbled 2.2 percent in New York. Saudi Arabian Oil Co. cut prices for all grades to the US, the company said Monday in an e-mailed statement. The state-owned producer, known as Saudi Aramco, will sell Arab Light to clients in Asia for 10 cents less than Middle East benchmarks, down from a November discount of $1.05. US crude imports from Saudi Arabia fell to a four-year low last month. “The Saudi move speaks to them wanting to preserve market share in the US, where it has slipped recently,” John Kilduff, a partner at Again Capital LLC, a New York-based hedge fund that focuses on energy said. “It looks like the Saudis are comfortable with prices and demand.”

WTI for December delivery fell $1.76 to close at $78.78 a barrel on the New York Mercantile Exchange. It was the lowest settlement since June 28, 2012. Prices lost 12 percent last month, the most since May 2012, and are down 20 percent this year.

The volume of all futures traded was 9.7 percent above the 100-day average for the time of day. Brent for December settlement declined as much $1.27, or 1.5 percent, to $83.51 a barrel on the London-based ICE Futures Europe exchange. The European benchmark crude traded at a premium of $5.96 to WTI. The spread widened for a fourth day to close at $6 yesterday.

  Saudi Prices

Saudi Arabia, OPEC’s largest producer, reduced the premium of Arab Light to US Gulf Coast benchmarks by 45 cents a barrel to the lowest level this year.

Discounts for Medium and Heavy grades were widened for a fourth month, according to Saudi Aramco, the state oil company.

OPEC, responsible for about 40 percent of the world’s crude supply, is scheduled to discuss output policy at a Nov. 27 meeting in Vienna. Its 12 members are producing more than their collective target of 30 million barrels a day, which has been maintained since January 2012.