Saudi Arabia raised oil prices for all regions as crude oil prices rose in the wake of the Russian invasion of Ukraine to more than $115 a barrel.
State-owned Saudi Aramco has raised a controlling stake, the premium to its Arab Light crude, for next month’s shipments to Asia to $4.95 a barrel above its benchmark.
The April price premium represented a $2.15 per barrel increase from the March price and the highest major-grade premium since Bloomberg began compiling data in 2000. Aramco was expected to raise prices by $1.70, according to a survey of traders and refiners.
Aramco raised prices for other grades for Asia by as much as $2.70 a barrel.
Aramco raised all prices for customers in the US by $1, and those for Northwest Europe by between $1.20 and $2.10. For the Mediterranean region, prices have gone up by as much as $2.
Oil is trading at its highest level in nearly 10 years, as Russia’s attack roiled markets from commodities to stocks and bonds.
Many customers are avoiding buying crude oil from Russia due to concerns that they might breach sanctions, even though the US and Europe have avoided imposing direct sanctions on Moscow’s energy exports.
This stretches an already crippled market and forces buyers to look for alternative supplies, including the Middle East.
Aramco’s decision came after the “OPEC +” alliance led by Saudi Arabia and Russia chose on Wednesday to continue increasing production only gradually.
The coalition made the decision, despite pressure from major importers, including the US, on coalition members in the Persian Gulf to pump oil faster and help lower global fuel prices.
Saudi Arabia, the world’s largest oil exporter, and the UAE have so far resisted calls to raise production beyond their quotas set by the alliance of OPEC members and partners. Such a move could cause a rift with Russia and possibly disintegrate the “OPEC +” alliance.
More than 60% of Saudi Arabia’s oil shipments go to Asia, with China, Japan, South Korea, and India being the biggest buyers.
Aramco’s pricing moves often determine the course of other producers in the Middle East.