NEW YORK, OCT. 6 -- Oil prices declined sharply in heavy trading today following a report that Saudi Arabia, apparently concerned about maintaining market share, has linked many of its oil sales to spot market values of other crudes.
On the New York Mercantile Exchange, the price for November delivery of West Texas intermediate -- the benchmark U.S. crude -- lost 38 cents to $19.44 a barrel.
There was no official Saudi confirmation of a report carried by Dow Jones News Services that quoted sources at major international oil companies as saying that, beginning last Thursday, many of Saudi Arabia's contract crude sales are being linked to the spot values of other crudes. The country's Arab light crude is not included in the policy, according to the report.
The report said Saudi oil industry officials recently approached Exxon Corp., Texaco Inc., Chevron Inc. and Mobil Corp., which make up the Arabian American Oil Co. (Aramco), for a formula to assure their steady buying interest in Saudi oil.
Bob Norberg, spokesman for the Aramco office in Washington, declined to discuss the report and issued a one-sentence statement: "Aramco has received no instruction from the Saudi Arabian government to bill lifters of Saudi crude oil at other than the official government selling price," Norberg said.
Traders said the report had a major impact on the markets and prices generally slid immediately after it was released.
Home heating oil lost 1.11 cents to 54.82 cents a gallon and unleaded gasoline lost 0.89 cent to 50.65 cents a gallon on the Merc.