Saudi cuts Asia prices as oil wavers

Saudi Arabia surprised observers on Friday by cutting Arab Light prices by as much as USD 0.75 for Arab Extra Light, international media reported.

Industry sources surveyed by Reuters days ago had predicted <a href=”https://theenergyyear.com/news/<a href=’https://theenergyyear.com/companies-institutions/opec/’>opec-compliance-continues-reports/”>a raise of at least USD 0.10 but a continuing global glut and competition for market share appear to have made Saudi officials cautious, analysts said.

“They are serious about market share now,” a client of Saudi Aramco who requested anonymity told the agency. “Many barrels are left [unsold].”

Though OPEC’s compliance with a production-cut deal struck last November has so far been over 90%, non-OPEC producers including Russia have fallen behind, with February data showing that Russia’s cuts during that month amounting to 100,000 bopd or about a third of what it has pledged. Russia has previously said that it would implement the promised cuts in full by April.

US crude inventories also rose by 1.5 million barrels last week, data released by the EIA on Wednesday showed, driving oil prices down. April Brent futures traded at USD 55.24 per barrel at 1:05 p.m. London time on Friday, up slightly from Thursday’s close of USD 55.08 but down about 2% from Wednesday’s closing price of USD 56.36.

US exports during that period, nevertheless, were down almost 40%, consultancy Petromatrix told journalists in a note.

“U.S. storage tanks are being filled with Saudi crude,” Petromatrix’s managing director Olivier Jakob said, quoted by UPI.