Saudi Arabia may raise crude oil prices in March for Asia

Flames emerge from a pipeline in the Basra oil fields, southeast of Baghdad, September 30, 2016. REUTERS/Essam Al-Sudani

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  • Arab Light Crude March OSP could rise 60 cents/barrel – survey
  • Improved jetting, fuel margins to support light grades

SINGAPORE, Jan 26 (Reuters) – Saudi Arabia, the world’s biggest oil exporter, may raise prices for all grades of crude it sells to Asia in March on firm demand and stronger margins for diesel and jet fuel, trade sources said.

The March official selling price (OSP) for flagship Arab Light crude could rise by around 60 cents a barrel from the previous month, according to seven refining sources polled by Reuters on January 25-26, marking a rebound after $1.10 a barrel. cut in February.

The expected price increases for March supplies come after Middle Eastern benchmarks strengthened this month. Crude demand in Asia has been robust as refining margins have remained firm, with the Omicron coronavirus variant having a smaller-than-expected impact on global fuel consumption so far. Read more

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Strong margins on gas oil and jet fuel should support larger price increases for light grades compared to heavier crude, traders said. , Saudi crude PSOs are usually released around the fifth of every month and set the trend for Iranian, Kuwaiti and Iraqi prices, affecting around 9 million barrels per day (bpd) of crude destined for Asia.

State-owned oil giant Saudi Aramco sets its crude prices based on customer recommendations and after calculating how the value of its oil has changed over the past month, based on yields and commodity prices.

Saudi Aramco officials have a policy of not commenting on the kingdom’s monthly PSOs.

Below are expected Saudi prices for the month of March ($/bbl vs. Oman/Dubai average): FEB Change est.MARS OSP

Extra light Arabic +3.20 +0.50/+0.80 +3.70/+4.00

Arabian Light +2.20 +0.45/+0.80 +2.65/+3.00

Average Arabic +2.05 +0.25/+0.65 +2.30/+2.70

Arabic Heavy +0.70 +0.30/+0.65 +1.00/+1.35

Source: Reuters, trade

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Reporting by Florence Tan Editing by Tomasz Janowski

Our standards: The Thomson Reuters Trust Principles.

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