Saudi Arabia has increased its crude oil prices for Asian buyers by $ 0.40 a barrel and lowered those for European and American buyers by $ 0.20 and $ 0.10 a barrel, respectively, Reuters reported. that the increase is for May cargoes, compared to April cargo prices.
This means that the May delivery price for Arab Light – Saudi Arabia’s flagship class – will cost Asian buyers $ 1.80 above the Oman / Dubai average, which is used as the basis for pricing. The Oman benchmark traded above $ 63 a barrel at the time of writing, and the Dubai contract was over $ 64 a barrel.
The news is unlikely to be welcomed by the two largest buyers of Saudi crude oil, China and India, especially India, which has voiced its opposition to OPEC’s price-raising efforts.
The world’s third-largest oil consumer has repeatedly called on the cartel to stop cutting production and let prices fall. Meanwhile, it has begun to look for alternatives to oil in the Middle East.
“We asked companies to aggressively seek diversification. We cannot be held hostage to the arbitrary decision of Middle Eastern producers. When they wanted to stabilize the market, I stood by them, “a government source told Reuters in early March.
India imports up to 80% of the crude oil it consumes. Of these, about 60% come from Middle Eastern producers. According to unnamed sources quoted by Reuters, India could diversify into more crude from the US and crude from the world’s newest producer – Guyana.
Meanwhile, the government has asked refineries to review their contracts with Saudi Arabia and other Middle Eastern producers and use their collective bargaining power to get better terms, The Hindu reported this weekend.
Meanwhile, China is devouring cheap Iranian oil despite US sanctions, and there may be no need to continue to buy at the rates it did last year, when crude oil was cheap wherever it came from.
By Irina Slav for Oilprice.com
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