Saudi Arabia will make bigger oil supply cuts to some of its Asian and European customers next month, industry sources said yesterday.

The move was aimed at stepping up the kingdom's efforts to halt the steep slide in prices.

While most Asian refiners appear set to receive steady supplies next month, news of the reduced allocations helped push oil prices up six per cent yesterday and suggested Riyadh is not waiting for Opec's December 17 meeting to tighten crude oil exports in an effort to keep oil from falling below $40 a barrel.

Oil traders had not expected Saudi Arabia to make any further explicit cuts ahead of that meeting, but yesterday at least two oil refiners in Asia were told by state oil firm Aramco that they would get less crude next month than this. An industry source said cuts were also deepened to some European lifters.

'We were cut 10pc... It was more than expected, we thought it would be around 5pc like last time,' a source with a major customer in Japan said.

Refiners measure their cuts versus the volume stipulated in annual contracts.

A second north Asian refiner outside of Japan also said its supplies would be cut by about 7pc, deeper than the 5pc curb that Saudi had given to nearly all its Asian buyers for December after Opec's 1.5 million bpd output cut.

The deeper cuts follow estimates last week showing that Opec met only two-thirds of its pledged November 1 production cut, and that Saudi Arabia remained in excess of its own implied quota.

Another three refiners in Japan and South Korea said their cuts would remain at 5pc below full volumes.

Saudi Arabia normally cuts all its Asian customers by a similar quantity to avoid the appearance of favouritism.

But some refiners have said that demand is so poor - and export margins so weak - that they would welcome receiving less Saudi oil. Some have said they requested lower shipments, although normally most Asian refiners nominate full volumes.

The Opec last month delayed a decision on a new oil supply cut until mid-December in order to give two previous cuts totalling 2m barrels per day (bpd) more time to work.

One industry source with a refiner outside of Japan said their supply of medium and heavy crude was reduced in January versus the norm, but their overall volumes were almost the same as their contract thanks to higher light crude sales.-Reuters