Saudi Arabia raises Arab Light premium to record $19.50 for Asia amid Hormuz disruption

Saudi Arabia has increased the official selling price of its flagship Arab Light crude for Asian buyers to a record premium, as disruptions linked to the Strait of Hormuz continue to affect global oil flows and pricing benchmarks, Bloomberg reported.

State-owned Saudi Aramco has set the May-loading Arab Light price at a premium of $19.50 per barrel above the Oman/Dubai benchmark, which is commonly used for crude exports to Asia. The level marks the highest premium recorded in Saudi pricing, according to market data.

The pricing decision comes as supply routes in the Middle East face disruptions, with oil flows through the Strait of Hormuz constrained. The situation has led to volatility in regional benchmarks and changes in procurement strategies by refiners.

Asian buyers have begun shifting some purchases to U.S. crude, pricing them against the ICE Brent benchmark instead of Dubai-linked pricing, as supply from the Gulf faces uncertainty.

Saudi Arabia is also redirecting part of its exports through the Yanbu port on the Red Sea to bypass the Strait of Hormuz, where vessel movement has been affected.

The pricing announcement follows the latest OPEC+ meeting, where producers agreed to increase output by 206,000 barrels per day. However, market participants said the impact of the increase may be limited due to ongoing supply constraints in the region.

Saudi Arabia typically announces monthly pricing around the fifth day of each month and does not provide detailed commentary on its pricing decisions.