Oil soared on Monday, with Brent surpassing US$120 per barrel after Saudi Arabia raised prices for its biggest market of Asia for July shipments amid rising demand as the region’s main economies easing coronavirus restrictions.
As of 13.00 hrs. local time in Thailand, Brent crude rose 86 cents, or 0.72%, to US$120.58 a barrel after touching an intraday high of US$121.95, while WTI crude futures jumped 85 cents, or 0.71%, to $119.72 a barrel after earlier hitting a three-month high of US$120.99.
Saudi Aramco, Saudi Arabia’s state-controlled oil company, on Sunday hiked its key Arab Light crude grade for Asian customers by US$2.10 a barrel from June to US$6.50 above the benchmark it uses, which is higher than the US$1.50 raise expected by the market.
The increase for July shipments resumes a series of increases that began in February and were only broken when the state-owned oil giant cut prices for its June shipments to US$4.40 a barrel. The cut came after strict lockdown in China amid surging Covid-19 cases in major cities such as Shanghai and Beijing.
Moreover, Saudi Aramco also raised the prices of shipments sold under long-term contracts after the rise of crude oil futures contracts due to the supply shortage from the Russian invasion in Ukraine.
