2 days Ago
(Bloomberg) -- Saudi Arabia slashed its flagship oil price by the most in more than two years, just days after the OPEC alliance announced an unexpectedly large output hike. State producer Saudi Aramco will lower Arab Light crude to its biggest buyers in Asia by $2.30 a barrel for May, according to a price list seen by Bloomberg.
While the large reduction comes on the back of some of the kingdom’s biggest price increases in years, the move was still bigger than expected in a survey of traders and refiners. It follows an OPEC output increase that delegates privately said was intended to instill better discipline among members like Kazakhstan and Iraq. OPEC , in which Saudi Arabia plays a leading role alongside Russia, announced on April 3 that it would add more than 400,000 barrels a day back into the global market next month, a supply boost three times larger than previously signposted.
The shock move deepened a rout in oil prices, which tumbled more than 10% last week after trade tariffs announced by President Donald Trump threatened the global economy. The extra output from May will come on top of an increase from the Organization of the Petroleum Exporting Countries this month, as it begins to unwind some of its production curbs imposed in 2022. It also plans further small increments in coming months.
Accelerating supply at a time of concerns over demand came as a surprise for many marketwatchers, given Saudi Arabia needs crude at above $90 a barrel to balance its spending. Oil in London dropped below $65 on Friday, the lowest in more than three years. Trump has pressed OPEC “to cut the price of oil,” which he says is needed to reduce inflation and heighten pressure on Russia to help end the war in Ukraine.
--With assistance from Anthony Di Paola. More stories like this are available on bloomberg.com ©2025 Bloomberg L.
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