Saudi Arabia hiked oil prices for Asian and US clients, indicating that demand remains high despite the emergence of the coronavirus’s omicron strain.
Bloomberg says that the move comes days after OPEC and its allies – a 23-nation group led by Saudi Arabia and Russia – startled traders by increasing crude output.
According to a statement from Saudi Aramco, prices for all oil grades that will be exported to Asia and the United States increased in January. From December to January, the business increased the price of its important Arab Light grade for Asian consumers by 60 cents to $3.30 a barrel above the benchmark.
Even as fresh Covid-19 instances threaten to sap demand, OPEC+ decided on Thursday to go forward with a supply increase for next month, believing that the oil market will shift from a supply deficit to a surplus in early 2022.
Brent crude has dropped 15% to just around $70 a barrel since late November, bringing the year’s gain to 35%. The drop is primarily owing to the finding of omicron and the potential of more barrels entering the market from OPEC+ and big importers like the United States, who are looking to reduce domestic gasoline costs.
