Saudi Arabia cuts crude oil prices for Asia to 5-year low amid rising signs of surplus reserves — here are the details

Organisation of the Petroleum Exporting Countries (OPEC) member Saudi Arabia has slashed its crude oil selling price to Asia for January 2026 to a five-year low amid rising signs of surplus reserves in the oil market, Reuters reported, citing pricing documents on Thursday, 4 December 2025.

According to the documents reviewed by the news agency, the January Arab Light crude oil official selling price to Asia dropped to $0.60 a barrel above the Oman/Dubai average, marking a five-year low.

This price cut in crude oil selling rates marks a second monthly drop and its lowest level since January 2021, according to the agency data. The report also highlighted that the Official Selling Price (OSP) premium for December 2025 was $1 per barrel.

Mirroring a downward trend?

The drop in oil selling rates is mirroring a downward trend in the overall OSP premium for Dubai, which has been down to an average of 70 cents so far in December 2025, compared to an average of 90 cents in November 2025, according to the agency report.

This drop in oil prices for Asia comes against the backdrop of rising supplies in the market as OPEC and allies led by Russia lift their oil production.

Have OPEC members paused oil output hikes?

According to the report, eight OPEC members have paused oil output hikes for the first quarter of the year 2026. This comes after the members increased their production targets to nearly 2.9 million barrels per day since April 2025.

Other oil-producing nations like the United States and Brazil are also increasing their supplies, adding to the concerns looming over excessive supply in the oil market.

OPEC, in its November 2025 outlook, changed the supply forecast to a surplus of just 20,000 barrels per day in the upcoming year, according to the agency's calculations compared to the previous forecast of a sizeable deficit in supply levels.

The intergovernmental body also lowered its 2026 demand forecast for crude oil by 100,000 barrels per day compared to the previous projection. The agency report also highlighted that a further cut in prices can spur additional Chinese buying, where independent refiners received the first batch of 2026 import quotas.