Top oil exporter Saudi Arabia trimmed its May crude prices for Asian buyers and slashed them for Europe, reflecting a plunge in values of competing grades and as oil demand traditionally weakens in the second quarter.
Most sour crude grades in Europe and Asia have been weakening in the past weeks, echoing Saudi Arabia’s official view that the market is well supplied as oil firms are cutting refining runs and entering a peak period for maintenance amid a seasonal drop in demand.
Sour crude grades, such as Russia’s Urals, similar in quality to Saudi’s Arab Light, have been weakening despite concerns that a EU-wide embargo on Iranian oil might create a supply shortage.
On Wednesday, Saudi’s state oil firm Saudi Aramco said it had cut its Arab Light May prices for Asian buyers by 35 cents to plus $2.45 per barrel versus the Oman/Brent average.
In Europe, Arab Light prices for Northwest Europe will fall by $2.60 a barrel to minus $3.85 a barrel versus Ice Bwave, it said.
By comparison, the competing Urals grade traded as low as dated Brent minus $3.60 per barrel this week, having weakened by about $2 over the past month.
In the Mediterranean, Arab Light prices FOB Ras Tanura will decline by $1.75 per barrel to ICE Bwave minus $2.85.
For its customers in the United States, Saudi prices have been trimmed slightly for medium and heavy grades and increased slightly for the light and extra light grades.