Saudi Arabia boosts oil prices to Asia $2.40, largest hike in over two years

Saudi Arabia's state oil and gas company Saudi Aramco has raised the price of its Arab Light crude oil to Asia by $2.40 a barrel for March, marking the largest increase in more than two years.

The move comes as the kingdom reacts to surging premiums for Middle Eastern crude and improving refinery margins in the region, Caliber.Az reports via foreign media. 

This hike, which is the steepest since August 2022, exceeds the $2 increase expected by traders and refiners

The rise follows significant price fluctuations for Middle Eastern crude in January and comes amid growing demand from Asia’s refiners, who have been scrambling to replace Russian oil following tough US sanctions.

The price of Middle Eastern crude has surged as the region's barrels are geographically and qualitatively closest to Russian oil, making them the preferred alternative. Refining margins in Asia have also strengthened in recent weeks, as some refineries reduced production, helping to justify the sharp price increase.

Despite fluctuations in global oil prices this year, including a brief rise above $80 a barrel for Brent Crude, prices have since dipped closer to $75. The ongoing uncertainty is also influenced by President Trump’s push for greater oil supply both domestically and from OPEC+, as well as his demand for heightened economic pressure on Iran.

OPEC+, led by Saudi Arabia and Russia, is set to begin easing some production cuts in April after several delays. A recent meeting of the monitoring committee did not recommend any changes, signalling that the group is unlikely to respond to Trump’s calls for lower prices in the short term.

By Aghakazim Guliyev