Wary Of Weakening Demand, Saudi Arabia Changes Pricing Strategy

The spike in oil prices to the highest level in more than a year worked wonders for the Middle East. Saudi Aramco is back to buying minority stakes in private Chinese refiners, enjoying the fact that oil prices have been more than $10 per barrel above its presumed fiscal breakeven for quite some time, offsetting the losses incurred before OPEC+ production cuts. Apart from boosting the Middle East’s fiscal “stability”, the Saudi production cuts of recent months have also greatly steepened Dubai backwardation, with the cash-to-futures-spread…