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Price cuts would typically draw higher demand, but some of the multiple sources said refineries had already completed purchases for February-loading cargoes and planned their production runs, leaving little room to lift more Saudi oil.
Asian Refiners: As a result, diesel prices are expected to fall, meaning Asia's refiners face a second consecutive year of sliding profit margins for the fuel used in cars, trucks and power generators. In 2022, average diesel profit margins soared to an all-time high of USD 45 a barrel, as supplies from top exporter Russia were disrupted and global inventories sank to a record low.
Oil prices rebounded on Monday on hopes of increased fuel demand during China's May Day holiday and planned supply cuts by the OPEC+ alliance. However, refining margins in Asia have weakened, curbing the region's appetite for Middle East oil supplies.
Saudi Arabia, the world's top oil exporter, raised prices for the flagship Arab light crude it sells to Asia for a third month in May after the OPEC group planned to further reduce their production by 1.16 million barrels-per-day from May to the rest of the year
Most Asian buyers halted Iranian oil imports in 2019 after former US President Trump withdrew from the nuclear deal with Iran and re-imposed sanctions on Tehran's oil exports