Saudi Aramco hikes March crude prices sharply - report

Feb 12, 2007, 12:15 GMT

Nicosia - Saudi Aramco sharply raised all crude oil grade prices for March deliveries to the United States by up to 2.30 dollars a barrel and to Europe by up to 1.45 dollars a barrel and increased the price formula for most grades destined to Asia, the Middle East Economic Survey reported Monday.

The Cyprus-based weekly publication said that while the increases to western customers reflect stronger prices for sour crudes in the US and Europe, the size of the rises was greater than customers anticipated and was seen as an attempt to curb demand through pricing at a time of OPEC production cutbacks.

For March deliveries to the US, where Saudi Aramco uses the West Texas Intermediate benchmark as its pricing reference, all prices were increased sharply, by 1.90 dollars a barrel for Arab Extra Light and by 2.30 dollars a barrel for Arab Heavy.

For March deliveries to Europe, where Saudi Aramco uses the International Petroleum Exchanges Brent Weighted Average (BWAVE) quoted value as its pricing reference, prices were also raised across the board from 1.20 dollars a barrel to 1.45 dollars a barrel.

The increase in Asia came in spite of a fall in sour crude spot prices there and can be attributed to some extent to a rebound in refining margins, the MEES report said.

For March deliveries to Asia, where Saudi Aramco uses the average of the Oman and Dubai crude prices as its benchmark, price changes were mixed, with three crudes raised by 20 cents a barrel to 90 cents a barrel, the finer Arab Super Light was left unchanged and Arab Extra Light was lowered by 15 cents a barrel.