Saudi Arabia has raised the prices for its shipments of crude oil to Asia and Europe, a sign that it sees an increase in the demand for oil in these markets.

Despite the slight decline recorded by oil futures contracts since the beginning of the year, many oil traders and officials of energy companies expect it to rise, perhaps to $ 100 a barrel, with the recovery of the Chinese economy after the lifting of closures related to the Corona virus, as well as slowing inflation in major economies. other.

Saudi shipments make up for the shortage of crude oil in global markets

Saudi Aramco, which is majority owned by the government, raised most of its OSPs to Asia in April, as the region's main Arab Light oil price rose 50 cents from March prices, to $2.50 a barrel above its benchmark.

increase for the second month

This increase is in line with the expectations of a Bloomberg survey of refiners and traders, which indicated a rise of 55 cents per barrel. This is the second month in a row that Aramco has raised prices for its shipments to Asia, its largest market.

Prices for shipments to US customers were unchanged, but those to clients in Northwest Europe and the Mediterranean jumped by as much as $1.30 a barrel.

Since the beginning of the year, the price of Brent crude fell only 0.1%, to record $85.83 a barrel, after a significant decline from about $115 a barrel in mid-2022, due to the slowdown in the global economy and the rise in interest rates to counter supply disruptions resulting from the Russian invasion of Ukraine.

A shift in demand trends

Last week, Amin Nasser, Aramco's chief executive, signaled a shift in demand trends, telling Bloomberg in Riyadh on March 1 that demand from China is very strong, and it's excellent in Europe and the United States.

Saudi Arabia, which is the world's largest oil exporter, leads the OPEC + alliance alongside Russia, and this alliance of 23 countries has announced that it will not raise oil production until at least next year.

Saudi Energy Minister: The OPEC + agreement will remain in effect throughout the year

Aramco sells about 60% of its crude shipments to Asia, mostly under long-term contracts, and its prices are reviewed every month. China, Japan, South Korea and India are the biggest buyers of Saudi oil. Other oil producers in the region, such as Iraq and Kuwait, often follow Aramco's pricing decisions.