Informed trade sources have revealed that Saudi Aramco, the world's largest oil exporter, plans to raise its official selling prices for oil to Asian markets in August, marking the highest levels since April.
This trend comes amid rising spot prices due to escalating geopolitical tensions in the region, particularly following the outbreak of the Iranian-Israeli conflict, along with increased seasonal demand for fuel during the summer.
A survey conducted by Reuters, which included five sources from four Asian refineries, indicated that the selling prices for "Arab Light" crude are expected to rise by between 50 and 80 cents per barrel, increasing the price to between $1.70 and $2 per barrel above average benchmark prices compared to the previous month.
This level is the highest since April, reflecting the impact of spot markets and rising demand in Asia, particularly from major economies like China and India.
The same sources also suggested that the official selling prices for Aramco's "Arab Medium" and "Arab Heavy" grades are expected to increase by between 50 and 60 cents per barrel, due to the continued recovery in regional demand, especially with the onset of the driving season in Asia, which is a significant driver of demand for refined fuel.
These expectations come in the wake of the severe tensions witnessed in the region during June, with an armed conflict between Iran and Israel erupting on the 13th of that month and continuing for 12 days. This conflict pushed global oil prices to their highest levels in five months, before retreating following the announcement of a ceasefire.
Aramco is expected to officially announce the new selling prices following the anticipated OPEC+ meeting on July 6, amidst widespread market anticipation regarding production trends and pricing policies amid the current geopolitical and seasonal challenges.
