Saudi Aramco increases Arab Light OSP for Asia to +$2/b
Quantum Commodity Intelligence – Saudi Aramco has increased its Official Selling Price (OSP) for the flagship Arab Light crude loading in May for refiners in Asia.
For Aramco's key customer base in Asia, differentials for the flagship Arab Light grade were priced at Platts Dubai/DME Oman +$2/b, up from +$1.70/b in April.
This was largely in line with expectations, based on a firmer market structure and slightly higher spot premiums last month.
The higher OSPs also came after OPEC+ maintained the Q1 round of voluntary cuts into the second quarter, while the crunch on supplies of sour crude has also underpinned Middle East grades.
Arab Medium was increased by $0.50/b to +$1.35/b, while Arab Heavy was also up by the same margin at +$0.50/b. Arab Extra Light was up $0.40/b to +$2.10/b.
Physical
Differentials for spot Middle East medium sour barrels improved slightly during March, although struggled during the second half of the month, but traders said Aramco typically takes the full monthly trading cycle into consideration in setting OSPs.
Premiums for flagship tradeable grades including Oman, Upper Zakum and Al Shaheen eased to around +$1.20-$1.30/b versus the underlying Dubai swap in the final week of March, having retreated from a peak of around Dubai +$1.70/b early in the month.
Last month, the Quantum average price for Dubai was $84.15/b on May-loading barrels versus $80.89/b on April-loading crude, a gain of 4%, with the market again underpinned by geopolitical tensions along with OPEC+ announcing a three-month extension to the additional voluntary cuts implemented at the start of the year.
For Northwest Europe, the Arab Light OSP was unchanged at +$0.30/b versus ICE Brent futures, while Medium was also unchanged at -$0.40/b, reflecting the relatively firmer Brent market.
Arab Light for April to the US Gulf was also kept unchanged at +$4.75/b over ASCI (Argus Sour Crude Index), while Medium was at +$5.65/b and Heavy at +$5.30/b, also both flat on the month.
