By David Hodari

 

Saudi Arabian Oil Co. on Thursday slashed the price at which it will sell crude oil to several markets in September.

The state-run Arabian oil company, otherwise known as Saudi Aramco, lowered the price for its Arab light crude oil--which it will sell in Asia in September--by $0.30 cents a barrel, giving it a $0.90 cents-a-barrel premium to the Oman/Dubai average. The decision ended a three-month streak of increases in its Asian light crude selling price.

The company reduced the price for medium and heavy grades of crude-oil to the Far East by $0.30 cents a barrel, and trimmed its extra and super light crudes by $0.50 cents and $0.60 cents a barrel to give the grades respective premiums of $0.70 cents and $2.05 a barrel versus the Oman/Dubai average.

For Northwest Europe and the Mediterranean, Saudi Aramco reduced its light crude prices by $2.50 a barrel and $2.10 cents a barrel, respectively, also at a discount versus the Oman/Dubai average.

Investors and analysts had forecast that the company would lower its official selling prices, as the decision by the Organization of the Petroleum Exporting Countries and its allies to relax oil-production curbs--starting in August--concerned investors that a global supply glut may take longer to drain away or even increase.

The rally in oil prices over early-summer stalled in recent weeks thanks in part to fears over demand amid the continued rise of coronavirus cases in several major economies.

Oil prices have remained steady in recent weeks, with demand indicators suggesting a broad recovery from the pandemic-related lockdowns and travel bans that hammered oil demand in the first half of the year. Still, fears of a second wave of infections have kept a ceiling over prices.

Oil prices ticked up Thursday with analysts citing a drop in U.S. oil inventories and a weakening U.S. dollar.

Brent crude oil was last up 0.5% at $43.38 a barrel, a day after hitting fresh five-month highs. Futures for West Texas Intermediate, the U.S. benchmark, were down 0.1% at $42.08 a barrel.

 

Write to David Hodari at david.hodari@wsj.com

 

(END) Dow Jones Newswires

August 06, 2020 11:55 ET (15:55 GMT)

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