- Oil heads for a third consecutive weekly gain following OPEC+ cut
- May ’23 WTI gains 6c this morning to trade around $80.67/Bbl
- Crude rose nearly $5, or 6.5%, this week after OPEC+’s surprise 1.66 MMBbl/d production cut
- Additionally, the U.S. Dollar fell to its lowest in two months, making oil more affordable for holders of other currencies
- Also, the market awaits Friday’s U.S. non-farm payrolls data amidst weak economic indicators from China and the U.S., raising demand concerns
- Saudi Arabia raises oil prices to Asia after OPEC+ surprise cut (BBG)
- Saudi Arabia increased the selling price for its flagship Arab Light crude to Asia by $0.30/Bbl in May, raising prices for a third consecutive month
- The price hike follows the surprise decision by OPEC+ to cut 1.66 MMBbl/d output starting May, with Saudi Arabia agreeing to slash production by 0.5 MMBbl/d
- Aramco maintains prices for Europe and Mediterranean customers, signaling that the kingdom expects strong demand in Asia, which accounts for 60% of its crude shipments
- Chinese private refiners increase purchases of Iranian oil amidst rising competition for Russian supplies (BBG)
- Chinese private refiners, known as teapots, are purchasing more Iranian oil due to increased competition for Russian supplies
- In March, China's imports of Iranian crude and condensate rose by 20% month-on-month to 0.8 MMBbl/d, with further increases expected
- Russian supplies are getting expensive as state-owned Chinese refiners and Indian refiners take a greater share
- Teapots are choosing Iranian oil over Russian supplies due to a $12/Bbl discount to ICE Brent for May delivery of Iranian oil compared to ESPO's $10 discount and Urals' $6 discount, according to traders