Saudi Aramco has increased Official Selling Prices (OSPs) for April-loading crude to Asia, Europe, and America largely in line with expectations of oil demand recovery during the second quarter of 2023.
For Aramco’s key customer base in Asia, differentials for the flagship Arab Light grade were lifted to Platts Dubai/DME Oman +$2.50/b for loading next month.
Arab Light for April to the US was up +$6.65/b over ASCI (Argus Sour Crude Index).
This coincides with optimism in the oil markets about the increasing demand for oil from China, the biggest oil importer globally.
Brent and WTI notched their third biggest weekly percentage gains this year as strong Chinese economic data fed hopes for oil demand growth.
Brent crude futures traded at $85 a barrel. US West Texas Intermediate (WTI) crude futures settled at $80 a barrel. Both benchmarks posted their highest closing levels since Feb. 13.
The head of the International Energy Agency (IEA), Fatih Birol, told the French publication Liberation that “Russia has lost the energy battle.”
Russia’s position as a significant energy supplier has suffered a permanent setback following the West’s abandonment of Moscow’s oil and gas due to its war in Ukraine, according to the head of IEA.
He noted that Moscow’s oil and gas exports have fallen by 40 percent since its military forces invaded Ukraine a year ago, adding that this is just the start of its problems.
Birol also emphasized that the departure of foreign experts from Russia would result in a decrease in oil and gas production without their technical support.
It would take years to build pipelines from Western Siberia to China, he added.
“Russia’s role in international energy affairs will be much less important in the future,” Birol said.
Exports via a major pipeline, which delivers natural gas to mainland Europe from the UK through Belgium, have been shut due to an equipment failure, according to Bloomberg.
The late Saturday halt to the link’s export capacities is expected to last until March 8, operator Interconnector Ltd said in a notice on its website Sunday.
The pipeline has been an important source of supplies to the European Union after severe cuts in exports from Russia. Even so, flows from Britain already fell last week as a late-winter cold snap boosts the country’s domestic demand for the fuel.