May 6, 2025
Saudi Arabia Increases Oil Prices for Asia as OPEC+ Expands Supply Further.
Saudi Arabia has increased the price of its main crude grade for Asia in June, coinciding with the OPEC+ group's decision to ease production cuts by adding a larger volume to the market next month.
This adjustment indicates that the Kingdom anticipates strong demand in Asia, raising the price of Arab Light crude by $0.20 per barrel compared to May, setting it at a $1.40 per barrel premium over the Oman/Dubai average benchmark.
Over the weekend, the OPEC+ group, led by Saudi Arabia, decided to boost collective output by 411,000 barrels per day (bpd), nearly tripling the previously scheduled amount. This follows a similar increase for May and marks a significant shift from OPEC+'s efforts to maintain oil prices.
The producers who are cutting output have cited "current healthy oil market fundamentals" as the reason for their decision to increase production volumes more than anticipated.
The eight OPEC+ countries involved—Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman—will be making month-to-month production decisions, with the next meeting scheduled for June 1 to determine July's production levels.
Saudi Arabia usually announces its crude pricing for the upcoming month around the fifth of each month and does not comment on price changes. It sets the pricing trend for other major Middle Eastern oil producers.
Last month, Saudi Arabia significantly reduced its crude prices for May ahead of the planned 410,000-bpd increase. Now, the world’s largest crude exporter has slightly raised its official selling price for June for Arab Light, possibly reflecting rising refining profits from Middle Eastern crude, which the Saudis monitor to assess demand and market conditions, according to Bloomberg.
This adjustment indicates that the Kingdom anticipates strong demand in Asia, raising the price of Arab Light crude by $0.20 per barrel compared to May, setting it at a $1.40 per barrel premium over the Oman/Dubai average benchmark.
Over the weekend, the OPEC+ group, led by Saudi Arabia, decided to boost collective output by 411,000 barrels per day (bpd), nearly tripling the previously scheduled amount. This follows a similar increase for May and marks a significant shift from OPEC+'s efforts to maintain oil prices.
The producers who are cutting output have cited "current healthy oil market fundamentals" as the reason for their decision to increase production volumes more than anticipated.
The eight OPEC+ countries involved—Saudi Arabia, Russia, Iraq, UAE, Kuwait, Kazakhstan, Algeria, and Oman—will be making month-to-month production decisions, with the next meeting scheduled for June 1 to determine July's production levels.
Saudi Arabia usually announces its crude pricing for the upcoming month around the fifth of each month and does not comment on price changes. It sets the pricing trend for other major Middle Eastern oil producers.
Last month, Saudi Arabia significantly reduced its crude prices for May ahead of the planned 410,000-bpd increase. Now, the world’s largest crude exporter has slightly raised its official selling price for June for Arab Light, possibly reflecting rising refining profits from Middle Eastern crude, which the Saudis monitor to assess demand and market conditions, according to Bloomberg.