Saudi Arabia has unexpectedly cut its November official selling prices (OSPs) for Asian buyers to their lowest level in six years, with the move aimed at supporting market share as elevated freight costs and regional disruptions continue to complicate crude shipments, according to Reuters.

Saudi Aramco set the November OSP for its flagship Arab Light crude to Asia at $5 per barrel below the average of Oman and Dubai crude prices, reducing the differential by $3 per barrel from October. The discount is the widest for the grade since June 2020.

The reduction came despite market expectations for an increase of up to $5 per barrel in a Reuters survey, following recent gains in Middle Eastern crude benchmarks. Aramco also cut the November OSPs for Arab Medium and Arab Heavy grades sold to Asia by $5 per barrel.

The pricing move contrasts with Saudi Arabia’s approach in other markets. Aramco raised November OSPs for all grades sold to northwest Europe by $3 per barrel, while leaving prices for US buyers unchanged.

The lower Asian prices come as Saudi Arabia seeks to offset exceptionally high transportation costs and maintain its position in one of its key export markets. Freight rates for very large crude carriers capable of transporting about 2 million barrels from the Gulf to China reached about $1.2 million per day on October 2, compared with around $80,000 a year earlier, according to LSEG data Reuters cited.

Three Asian refining sources told Reuters that the OSP reductions appeared intended partly to compensate buyers for the higher freight costs. Saudi Aramco had already been considering discounts for crude loaded through ship-to-ship transfers off Oman as disruptions to regional shipping routes increased transportation expenses.

The disruption has also affected Saudi shipments through Egypt. Reuters reported that lower OSPs could compensate buyers for longer voyages and loading delays affecting Saudi crude exported through Sidi Kerir, Egypt’s Mediterranean oil terminal. Since September, Aramco has used ship-to-ship transfers outside the Strait of Hormuz to maintain exports, while Saudi Arabia has also resumed loading at Yanbu following an earlier disruption to its East-West oil pipeline.