Saudi Aramco delays oil pricing statement as OPEC+ talks continue

Saudi Arabia is pushing back a key decision on pricing for its crude exports as the kingdom seeks to commit global producers to a massive coordinated supply cut.

State producer Saudi Aramco is set to decide on and announce pricing for May crude exports on Sunday, according to people with knowledge of the situation. The official selling prices, or OSPs, were meant to be released April 5 before twice being delayed to allow producers time to discuss output cuts amid demand destruction due to the coronavirus.

Aramco didn’t immediately comment on the delay. The company’s pricing is a key indicator for traders since it affects about 14 million barrels a day of Gulf crude exports. Other producers in the region follow Aramco’s lead in setting prices for their own shipments. Abu Dhabi and Kuwait have also said they’re waiting for the outcome of the meetings before releasing pricing.

Talks among global producers aimed at securing curbs of 10 million barrels a day entered their third day Saturday. Saudi Arabia convened OPEC+ members Thursday, hosted a conference call of G-20 energy ministers Friday and is set to speak with US and Mexican officials Saturday. The meetings that stretched overnight failed to overcome Mexican resistance to the proposed reductions.

By bringing together the Organisation of Petroleum Exporting Countries and partners such as Russia, Saudi Arabia took steps to end an oil price war it had unleashed just a month before. The world’s top exporter slashed the OSPs for April exports by the most in at least three decades.

Benchmark Brent has plunged by more than half since the start of the year as the Saudis made good on their threat to begin pumping a record 12 million barrels a day at the start of April. The supply glut exacerbated a collapse in oil demand as the coronavirus pandemic forced lockdowns worldwide and economies ground to a halt.

OPEC+ talks in March collapsed, allowing production curbs to expire at the end of that month. Under the latest proposed agreement, both Saudi Arabia and Russia would pare output back to about 8.5 million barrels a day.