Saudi to Offer Discounted Oil Price of $6 per Barrel to Asia in July - Energy

With tanker ships stranded in the Persian Gulf and empty vessels forbidden from entering to take on new cargo, the region has drastically reduced production, shut down oil fields, and slowed or stopped refining.

Arab Saudi Oil Company (Aramco) has become the go-to exporter of crude oil from the Gulf due to its ability to reroute oil through a pipeline across the country to the port of Yanbu on the Red Sea.

This has allowed the company to send up to 70% of its pre-war exports while also supplying crude to refineries on the western coast of the country.

The facilities on the Red Sea have been pumping products such as diesel and jet fuel as Aramco has been trying to capitalize on the booming margins for its refineries.

The profit margins from refining crude into processed products remain high but decreased in late May, possibly indicating a decrease in demand due to consumers facing higher prices.

Aramco traditionally sets the price of its crude oil based on refinery profit margins, which may explain its decision to reduce the official price for July.

The OPEC+ group, led by the Kingdom of Saudi Arabia and Russia, decided to raise its production target for July by 188,000 barrels per day during its meeting on Sunday (7/6/2026).

This increase is largely symbolic, given that the Strait of Hormuz is still largely closed off, but it signals that the group will not limit its members from pumping oil into the market once the conflict with Iran is resolved.

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