In a surprising turn of…
OPEC has increased oil production…
Even as Saudi Arabia vies for market share with a post-sanctions Iran, the Kingdom has raised oil pricing for Asian and U.S. customers, but dropped prices for Europe exports.
Saudi Aramco’s July pricing for Asian customers will be 35-60 cents per barrel higher than the regional benchmark Asia sales, Bloomberg reported. This is the second straight month Saudi Arabia has raised prices to Asia.
For U.S. customers, July Arab Light crude will go up by 20-55 cents per barrel more than the regional benchmark, though prices on Extra Light crude will remain unchanged.
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Apparently confident in rising Asian demand to maintain its market share in that region, for Europe, to the contrary, crude prices will be further discounted. While Iran is ramping up exports to Europe, Saudi Arabia is necessarily playing to the market by dropping prices here.
Saudi Aramco cut its light crude prices by 35 cents a barrel to northwest Europe and by 10 cents a barrel to the Mediterranean for July deliveries, according to an email sent to customers, cited by Nasdaq.
Back on the European market since February, Iran is now exporting around 400,000 barrels per day of crude oil to the European Union, cutting in on Saudi Arabia’s European market share. Iran is now eyeing 700,000 bpd in exports to the EU before the end of this year, boosted by recent deals with Greek, French and Italian refiners.
Related: Saudi Arabia Raises Oil Prices to Asia But Cut Prices to Europe
The Saudis are hoping to maintain the 800,000 bpd they exported to the EU last year. In this game, the Iranians believe they have the advantage due to their comparatively lower dependence on oil revenues.
Iran is getting an export boost thanks to international oil tankers that are helping it to ramp up shipments and secure new market share faster. More than 25 European- and Asian-owned supertankers are now shipping Iranian oil, Reuters reported.
By James Burgess of Oilprice.com
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James Burgess studied Business Management at the University of Nottingham. He has worked in property development, chartered surveying, marketing, law, and accounts. He has also…