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Asian oil traders are bracing for another round of hefty price falls on Monday in key benchmarks Brent and Dubai after the world’s top exporter Saudi Arabia slashed prices, reigniting a market share battle among key producers.
The world’s top producers, including Saudi Arabia, Russia and other West Asian nations, were last locked in a market share war between 2014 and 2016 as they tried to squeeze out shale production from the US by reducing prices and offering more supplies to Asia.
The battle ended when OPEC and Russia struck a deal to cut production. That truce shook on Friday when OPEC, led by Saudi Arabia, failed to reach an agreement with the world’s No. 2 oil producer Russia to deepen production cuts aimed at shoring up prices.
Global price marker Brent dived more than 9 per cent on Friday to $45.27 a barrel, its biggest single day loss in 11 years.
Late on Saturday, Saudi Arabia slashed its official selling price (OSP) for April for all its crude grades to all destinations. The producer also planned to raise in April its production to more than 10 million barrels per day (bpd) for the first time since May 2019.
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