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Saudi Arabia reduced prices for all crudes destined to Asia, its biggest market, after OPEC+’s decision to keep slow production increases sent oil futures surging. 

State producer Saudi Aramco lowered its key Arab Light grade to Far East customers in November by 40 cents to $1.30 a barrel above the average of Oman and Dubai crudes, the smallest premium since March, according to documents seen by Bloomberg. The world’s largest oil exporter also cut prices for nearly all grades headed for the U.S., the Mediterranean and Northwest Europe. 

The decision comes after the OPEC+ cartel -- led by the Saudis and Russia -- opted on Monday to continue with a gradual approach to production increases, even as a gas shortage in Europe and Asia boosts demand for crude for power generation. The group’s move triggered a surge in crude prices, with those in the U.S. climbing to a seven-year high.

The cut in the official selling price for Arab Light crude was in line with market expectations. 

Since the start of the year, Brent crude has jumped almost 60% as major economies recover from the coronavirus pandemic and OPEC+ maintains supply restrictions.

Aramco’s chief executive officer, Amin Nasser, said on Monday that demand for crude had climbed by 500,000 barrels a day as some businesses and power producers are forced to switch from gas to oil.

Saudi Arabia sends more than 60% of its crude exports to Asia, with China, South Korea, Japan and India the biggest buyers.

This story has been published from a wire agency feed without modifications to the text. Only the headline has been changed.

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