Aramco cuts Asia oil prices to four-month low

Saudi Arabia, the world’s top oil exporter, has slashed crude oil prices for Asian buyers in May to their lowest in four months.

This follows a recent shock decision by the Opec+ oil group to speed up oil output hikes.

State oil company Saudi Aramco cut the May official selling price (OSP) for flagship Arab Light crude by $2.30 to $1.20 a barrel above the average of Oman and Dubai prices, a pricing document from the producer showed.

The drop marks the biggest decline in more than two years and is the second consecutive month Aramco has lowered its prices, Reuters record of Saudi OSPs showed.

The company also lowered May prices for other grades it sells to Asia by $2.30 per barrel.

Eight Opec+ countries in a surprise decision agreed on Thursday to advance their plan to phase out oil output cuts by increasing it by 411,000 barrels per day in May, triple the expected increase, representing around 0.4 percent of global supply.

The news, together with an escalating global trade war, sent oil prices plunging nearly 11% in the week ending April 4, hitting more than three-year lows.

Prior to the latest decision by Opec+, analysts surveyed by Reuters had expected Arab Light for Asia to be cut by $1.80 to $2, tracking the steep declines in benchmark prices in March.

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The spot premium of Dubai averaged $1.38 per barrel in March, down from $3.33 per barrel, the average in February. The drops were also due to more Russian supply returning to Asia, following disruptions in January and February caused by US sanctions on Russian energy trade.

The tables below show the full free-on-board (FOB) prices for May in US dollars.

Saudi term crude supplies to Asia are priced as a differential to the Oman/Dubai average: