NEW DELHI: Saudi Arabia raised the “official selling price” of oil shipments in Asia on Sunday, or OSP, in May, but left the European price unchanged, indicating that India’s plan to reduce Saudi Arabia’s imports will not affect the world’s largest crude oil exporter.
OSP has been increased by 20-50 cents per barrel for various crude oils, Bloomberg reported. Saudi Aramco sets OSP on a monthly basis for oil delivered under fixed-term contracts. Other West Asian producers refer to their prices.
The OSP check comes in the middle government calls on state refiners to reduce Saudi Arabia’s oil imports and use their “collective influence” to negotiate better agreements in 2014-15. New Delhi’s latest Salvo follows a protracted war of words with Riyadh over OPEC-Plus. The program ignores India’s calls to stop production cuts that have raised prices.
Minister of Oil, when fuel prices rose to record highs partly helped by high taxes Dharmendra Pradhan said the group “backed down” to a consensus among buyers and sellers as demand fell in April 2020. His Saudi counterpart, Abdulaziz bin Salman, responded, suggesting India sink into its cheap oil storage.
This was in stark contrast to officials claiming India’s victory in February after Saudi Aramco had left Asian March prices unchanged but raised for Europe.
In 2014–15, a number of executives from all state-run oil companies and government officials had visited Kuwait, Abu Dhabi and Saudi Arabia in the past without success because Riyadh is reluctant to deviate from established norms based on market dynamics. OSP is the quality difference between Saudi crude oil and the Dubai-Oman basket monthly base price. Singapore. The base price is derived from the 30-month moving average of exchange rates.
For Indian refineries and crushers of other Asian buyers, West Asia, which accounts for 60% of Indian oil imports, is difficult to beat as a cost-effective source due to its proximity, low delivery cost and ability to supply binding volumes. Nor is joint purchasing a novice because of the individual needs of each refinery. For the same reasons, the United States is not always a cost-effective source, although it has become the second largest supplier as India diversifies its sources. African producers have problems meeting their commitments.