Saudi Arabia, the world’s top oil exporter, raised September crude oil prices for Asian buyers to record high levels despite falling refining margins.
The official selling price (OSP) for September-loading Arab Light to Asia was raised by 50 cents a barrel from August to $9.80 a barrel over Oman/Dubai quotes, people familiar with the matter said, leapfrogging the previous record of $9.35 per barrel set in May.
The price hike was lower than market forecasts of 70 cents to $1 a barrel.
“Now all crude grades are getting cheaper, so Saudi needs to make its prices competitive. Otherwise traders will take spot cargoes (rather) than lift Saudi oil,” said a Singapore-based trader.
Profit margins at Asian refiners who process Dubai crude plunged by as much as 96% in July, pressured by the prospect of a global economic recession and weakening fuel demand.
The OSP for Arab Extra Light was increased by 30 cents to $10.95 a barrel, and for Arab Medium by 60 cents to $7.75 a barrel, both record levels.