Saudi Aramco announced the official selling prices for shipments of Arab Light crude to its customers in Asia, Europe and the United States, during the month of March of this year (2023).
The company decided to raise the official selling prices for Arab Light crude to Asia by 20 US cents to $2 per barrel, above the average prices of the Sultanate of Oman / Dubai, according to the pricing document seen by the specialized energy platform.
Saudi Arabia raised all prices for European buyers by $2 a barrel, and most prices for the United States by about 30 cents.
This step on the part of Saudi Aramco came in contrast to the results of a recent survey, seen by the energy platform, which predicted a decrease in Saudi oil prices in Asia during the month of March, with the decline in oil premiums and the increase in fears of increasing supplies, despite expectations of a recovery in demand in China, according to what was published. Reuters.
Aramco prices and Asian demand
Although the demand for medium crude in Asia is still weak, at a time when the hoped-for increase in Chinese demand is still far away, it is expected that the demand for fuel in China will witness a significant increase, with Beijing abandoning the strict restrictions in the face of the Corona pandemic.
The increase in Aramco prices came amid optimism among many OPEC members about the situation in China in recent days.
Haitham Al-Ghais, Secretary-General of the Organization of Petroleum Exporting Countries, expressed optimism about the situation in Beijing.
While the CEO of the Kuwait Petroleum Corporation, Sheikh Nawaf Saud Nasser Al-Sabah, said that consumption in China – the largest importer of crude oil in the world – is on the rise, according to statements to Bloomberg Agency.
At the same time, Unipec, the trading arm of Sinopec, was able to purchase supplies at discounted prices from the UAE, Brazil and North America during January, in a move that revives hopes that Chinese demand will return strongly during the second quarter of the year. The current year 2023.
It is expected that Saudi Aramco will benefit from the entry into force of the European Union’s decision to ban oil derivatives from Russia transported by sea, starting from February 5, which will lead to an increase in crude oil exports from producing countries.
Goldman Sachs expects Brent crude to rise back above $100 a barrel in the third quarter as China fully reopens its economy, and Morgan Stanley has a similar forecast.
Saudi Arabia is the largest oil exporter in the world, and sells about 60% of crude oil shipments to Asia under long-term contracts, and it reviews its prices monthly.
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