Saudi Arabia raised oil prices for all regions after crude surged following Russia’s military offensive in Ukraine to more than $115 a barrel.
State-controlled Saudi Aramco increased its Arab Light crude price for next month’s shipments to Asia to $4.95 a barrel above the benchmark it uses. That is an increase of $2.15 a barrel from March and the highest premium for the grade since Bloomberg started compiling data in 2000.
The energy company was expected to increase pricing by $1.70, according to a survey of traders and refiners.
Aramco put prices for other grades for Asia up by as much as $2.70 a barrel. It raised all prices for US customers by $1, and those for north-west Europe by between $1.20 and $2.10. For the Mediterranean, pricing increased by as much as $2.
Oil is trading at its highest levels in nearly a decade as Russia’s attack on Ukraine upends markets from commodities to stocks and bonds.
Many buyers are avoiding crude from Russia because of concerns they could breach sanctions, although the US and Europe have avoided directly penalising Moscow’s energy exports.
That is stretching an already tight market and forcing buyers to look for alternative supplies, including from the Middle East.
Aramco’s decision came after Opec+, led by Saudi Arabia and Russia, on Wednesday opted to continue raising output only gradually. That was despite pressure from major importers, including the US, for the group's Gulf members to pump faster and to help bring fuel prices down.
More than 60 per cent of Saudi Arabia’s oil shipments go to Asia, with China, Japan, South Korea and India the biggest buyers. Aramco’s pricing moves often set the tone for other producers in the Middle East.