A few days ago, Saudi Arabia assured that oil prices in Asia would remain unchanged. However, this seems to be not true, as Saudi has announced that it will increase the price of its main oil grade for buyers in Asia from next month onwards. This announcement comes days after the OPEC+ group agreed on extending the output cuts this year, too.Â
A single barrel of crude oil was being traded at around $80 in London this year, which has concerned refiners and traders over oil demand and slowed economic growth in the nation. Geopolitical tension in the Middle East has also played a role in the increased price of oil and the production cut by the OPEC+ group. For now, Aramco has increased the price of crude oil by $1.7 per barrel. This is higher than the expectations of refiners and traders.Â
The OPEC+ is extending the output cuts until the end of June or July to prevent a global surplus of oil in markets. As the group’s largest oil producer and leader, Saudi Arabia is pushing for oil cuts to prevent a surplus of oil.
Moreover, the Saudis have also limited their current supply chain and halted the production of 13 million barrels per day to the current 12 million barrels per day.
Today, every country is looking for a sustainable source of oil to secure its energy needs. However, this increase in oil prices will not benefit these countries.
