Saudi Arabia, the leading oil exporter globally, has made a significant adjustment to its crude oil prices for Asian buyers, marking the first reduction in three months. This decision was announced on Friday and aligns with market predictions and the recent agreement by OPEC+ to incrementally boost oil supply in April.
The official selling price (OSP) for Saudi Arabia’s flagship Arab Light crude has been lowered by 40 cents to $3.50 a barrel above the average prices of Oman and Dubai, as indicated in a pricing document released by state-owned Saudi Aramco. This price adjustment comes after Arab Light reached its peak in the previous month, sitting at $3.90 above the Oman and Dubai average due to increased U.S. sanctions on Russian oil that disrupted global trade and led to a surge in oil prices and freight rates.
In addition to the Arab Light grade, Saudi Aramco has also reduced prices for other oil grades sold to Asia. The pricing cut for Arab Light is consistent with expectations from a Reuters poll, which anticipated reductions ranging from 20 to 65 cents.
Furthermore, OPEC+, which is responsible for about half of the world’s oil production, has announced plans to increase oil output by 138,000 barrels per day in April, marking the first such increase since 2022. Additionally, there has been a notable resurgence in oil supply from Russia and Iran to China, the largest importer of oil, as non-sanctioned tankers are attracted by profitable opportunities, alleviating prior supply concerns.