In an unexpected move seen as bullish by futures traders, Saudi Aramco lifted the official selling price (OSP) of its flagship Arab Light crude grade to Asian customers for May loadings.
Aramco raised the OSP for Arab Light for Asia next month by $0.10 a barrel compared to April prices, to a premium of $1.20 to the Oman/Dubai Middle East benchmark.
For April, Saudi Arabia had cut the OSP for Arab Light for Asian customers by $0.55, the first cut in eight months, and a sign that it continues to fight for market share.
The Saudi pricing usually sets the trend in the OSPs of the other Middle Eastern producers, so they are closely watched by the market.
Earlier this week, a Reuters survey of six refiners and traders showed that they expected Saudi Arabia to cut its OSPs for all its crude grades bound for Asia next month. Traders had expected the Arab Light crude price to be lowered by between $0.50 and $0.70—the lowest in six months—to reflect weaker Dubai crude prices.
“We expect cuts of 50-60 cents across all grades,” one respondent in the Reuters survey said.
But Saudi Arabia surprised the market with higher Arab Light prices and such unusual divergences between expectations and actual pricing could suggest that Saudi Arabia may have different view from the traders and refiners about major oil market data such as refining margins for example, Bloomberg notes. Related: Venezuela’s Oil Sector May Soon Have New Owners
The Saudis met traders’ expectations with the pricing of the other grades to the Asian market, lowering the OSPs relative to Oman/Dubai by between $0.20 and $0.50 for May compared to April.
To the U.S. customers, Saudi Aramco lowered by $0.10 the prices of the Arab Light, Medium, and Heavy, but raised the Arab Extra Light price.
The Saudis raised all grades prices to Mediterranean customers and raised prices the most for Northwest Europe.
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By Tsvetana Paraskova for Oilprice.com
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