Saudi Aramco has increased its official selling prices (OSPs) to Asia and Europe for March. The move, which partially reversed the previous two months’ price cuts, took observers by surprise. Oil prices remain relatively subdued, with Brent in the mid $80s, while Opec+ last week reaffirmed its commitment to keeping cuts in place until the end of the year (MEES, 3 February).
Still, the price hike comes amid increased speculation that China’s move to end its zero-Covid policy could cause global demand to surge in the second half of 2023. Key monthly reports from Opec and the IEA have pointed to the potential for a global oil supply shortfall in the second half of the year (MEES, 20 January). Most recently, the US EIA’s February Short Term Energy Outlook (STEO) this week forecast that Chinese demand will increase by 700,000 b/d in 2023. (CONTINUED - 428 WORDS)