Saudi Arabia is delaying the release of its closely-watched monthly oil-pricing list until later this week as the kingdom spars with Russia over a potential meeting of global producers that would aim to halt the collapse in crude. State oil producer Saudi Aramco is now set to announce its official selling prices for May on Thursday, according to people with knowledge of the situation who asked not to be identified because the information is private. The OSPs, as the prices are known, were due on Sunday.
Aramco is holding off on the announcement to await signs of what may happen when suppliers meet Thursday to discuss crude production. The company’s media office declined to comment on the delay. With the coronavirus pandemic gagging oil demand, benchmark Brent crude has plunged 48% this year. Saudi-Russian diplomatic barbs, which are opening a fresh rift between the world’s two largest oil exporters, jeopardize a deal to cut output and keep crude from tumbling further.
The coalition known as OPEC+ had curbed production since 2017, but limits on its members’ output expired at the end of March after Saudi Arabia failed to persuade Russia to accept deeper cuts. While the Saudis have changed course and are now ramping up production to record levels, U.S. President Donald Trump said suppliers are open to pumping less to take 10 million to 15 million barrels of unwanted crude off the market.
The debate over new production cuts poses a challenge for the world’s most valuable listed company as it tries to decide how to price its crude. By delaying its announcement, Aramco can better gauge the amount of oil it may have available to sell next month. The postponement would also give it time to deepen its price discounts should an OPEC+ deal fall apart, as Aramco is competing for sales in a glutted market.