Saudi oil sales to China to halve - report

Saudi Arabia’s crude sales to top importer China are set to halve next month as the war in the Middle East upends flows and lifts prices, Bloomberg reported, citing sources.

The world’s biggest exporter is set to ship around 20 million barrels of oil to its customers in China for May, the traders said, asking not to be identified as they aren’t authorized to speak publicly. That’s down from roughly 40 million barrels allocated for loading in April.

The cut in sales comes after Aramco raised official selling prices of its crude to a record, as the Iran war resulted in the effective closure of the Strait of Hormuz and upended energy flows. Saudi Arabia has an outlet for its oil at the country’s Yanbu port in the Red Sea, but it’s not able to funnel all of the supplies that used to go through the Persian Gulf using that link.

The war in the Middle East, now in its second month, shows no signs of easing, after talks between the U.S. and Iran in Pakistan failed to yield an agreement over the weekend. In an escalation, U.S. President Donald Trump threatened to blockade the Strait of Hormuz, preventing all maritime traffic from entering and exiting Iranian ports from 10 a.m. Washington time on Monday.