The world’s top oil exporter, Saudi Arabia, raised on Thursday the prices of all its crude oil that will go to the United States and Europe in March while leaving unchanged the official selling prices of its crude to its key market in Asia.
The Saudi state oil giant Aramco raised the prices of all its crude grades to the U.S. by $0.10 per barrel, while the Saudi oil prices to Europe were lifted by between $1.30 and $1.40 a barrel, according to Bloomberg.
The price of the Saudi flagship Arab Light crude grade to Northwest Europe was raised by $1.40 a barrel for March compared to February and set at a discount of $0.50 a barrel against ICE Brent, Reuters reported, citing a pricing document it had seen.
Last month, a day after surprising the market with a 1-million-bpd additional production cut for February and March, the Saudis raised the official selling prices (OSPs) of their oil for Asia for February. Saudi Aramco lifted the price of the flagship Arab Light grade by $0.70 a barrel to a premium of $1 per barrel against the Middle East benchmark, the Oman/Dubai average.
This month, however, the Saudis are leaving the prices to Asia unchanged for March compared to February, after the extra production cut created a rush among refiners in Asia in January, with buyers scrambling to secure crude oil supplies from Europe.
Saudi Arabia has also reportedly announced reductions in crude oil volumes to be supplied to at least nine clients in Asia and Europe for this month. The cuts were made for shipments under long-term contracts and concern Aramco’s heavier grades, according to Bloomberg.
The extra Saudi cut looks to be working, for now, in favor of the OPEC+ producers who are desperate to see higher oil prices to patch up their budgets hit by the crash in oil prices and the economic downturn due to the pandemic. Oil prices have rallied over the past month since Saudi Arabia announced the additional 1-million-bpd cut.