Saudi Arabia kept the price for its flagship Arab Light crude to Asia in March untouched at a level that is more than two years below what it was, in a surprise move to preserve its market share, according to Reuters citing Aramco’s statement on Tuesday.
This month, Saudi Aramco maintained the previous month’s official selling price (OSP) of $1.50 per barrel above the Oman/Dubai average for March-loading Arab Light to Asia.
In response to competition from rival suppliers, the state-owned oil giant reduced the OSP for February cargoes by the most in 13 months, reaching a 27-month low.
Due to the improved market structure, supply disruption concerns amidst the escalating Middle East unrest, and other factors, the March price was lower than the market expectations, which predicted Saudi Arabia to raise the OSP by approximately 55 cents.
“(The stable price) is most likely came as Saudi Arabia is keen to secure its market share,” a trading analyst with a North Asian refiner told Reuters.
“Saudi’s crude allocations to China have dropped heavily in recent months.”
Due to high prices, Chinese refiners requested limited supplies of Saudi crude for January and February loading.
The company’s statement also included that Saudi Aramco slightly lowered the price of Arab Extra Light and Arab Medium to Asia while maintaining the price of March Arab Heavy crude.
Saudi Aramco reduced the price of Arab Light to the United States by $0.30 per barrel but did not modify its March OSPs for northwest Europe.
Oil movement on Tuesday
Brent Crude rose by 0.26 per cent to trade at $78.19 a barrel.
West Texas Intermediate (WTI) climbed by 0.12 per cent to trade at $72.87 a barrel.
