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Saudi Arabia seeks to oust Russian oil from the market

US, WASHINGTON (NEWS OBSERVATORY) — Saudi Arabia has stepped up efforts to oust the Russian brand of Urals oil from major markets, offering in return its own oil at low prices, reports Reuters, citing seven sources in the oil industry.

Riyadh previously announced a reduction in its oil prices for buyers from all regions since April after the OPEC + deal was broken. Russia rejected a proposal to increase existing OPEC + production cuts, which led to the collapse of the alliance and the start of a price war for market share .

Market sources told Reuters that the state-owned oil company Saudi Arabian Oil Co. (Saudi Aramco) is trying to replace Urals in supplies to refineries around the world – from Europe to India.

The national shipping company of Saudi Arabia, Bahri, pre-chartered up to 19 supertankers this week, with six of them shipping around 12 million barrels of Saudi oil to the United States.

Saudi Aramco is in talks with European oil refineries, including large Urals oil buyers such as Finnish Neste Oil, Swedish Preem, French Total, as well as BP, Azerbaijani SOCAR and Italian Eni, the agency said.

In addition, Riyadh has been negotiating oil supplies with Minsk since last year, and Belarus considers the proposed prices “remarkable”, a source in one of the Belarusian oil traders told Reuters.

Saudi Aramco can only deliver an additional 1.5 million barrels per day to Europe in April, one source said.

This week, Saudi Arabia announced its intention to increase its oil production capacity from 12 to 13 million barrels per day.

This tactic is already working, and oil refiners are ordering additional volumes of Saudi oil for shipment in April at “very attractive prices,” Reuters sources said. According to them, Saudi Aramco is trying to “punish” Moscow for disrupting the OPEC + deal and return the Russians to the negotiating table.

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Article is written and prepared by our foreign editors from different countries around the world – material edited and published by News Observatory staff in our US newsroom.