Oil futures fell around 1% after Saudi Arabia slashed the price for its flagship Arab Light crude to Asian customers, a barometer for how the kingdom sees the demand outlook.
“The decrease was larger than the market was expecting,” ING said. “OSPs [official selling prices] for all grades into Europe, the Med and the U.S. were also cut for February.”
However, geopolitical tensions in the Middle East and Libya’s National Oil Corp. declaring force majeure at the Sharara oilfield still provide support to the market due to heightened fears of supply disruptions.