American pressure rises .. Saudi Arabia postpones May crude prices until after the OPEC Plus meeting

A senior Saudi source said today, Sunday, that Saudi Aramco will postpone announcing the official selling prices for its raw materials for next May until April 10, pending the outcome of a meeting between OPEC and its allies regarding possible production cuts.

This comes at a time when US President Donald Trump suggested the possibility of imposing duties on oil imports, along with talk of a similar measure that Canada might take.

"It is an unprecedented measure that Aramco has not taken before. Official selling prices for next May will depend on the outcome of the OPEC Plus meeting," the informed Saudi source said.

"We are doing our best to make it successful, including taking this extraordinary step to postpone the official selling prices," he added.

According to the same source, Saudi Arabia wants to avoid what happened last March when the oil talks collapsed due to Russia's lack of cooperation with the rest of OPEC Plus.

For its part, Bloomberg reported that Aramco will postpone the announcement of its raw materials prices, pending the appearance of indications of what might happen at the OPEC Plus meeting, according to German news agency DPA.

Aramco usually issues official selling prices by the fifth of each month, on the basis of which the prices of Iranian, Kuwaiti and Iraqi materials are determined, and affects more than 12 million barrels per day of oil destined for Asia.

American pressure
OPEC and its allies will meet next Thursday to discuss a possible reduction in global crude supplies in order to end a price war between Saudi Arabia and Russia that led US President Donald Trump to intervene.

Trump said on Saturday that he would impose customs duties on crude oil imports or take other measures if necessary to protect energy workers from falling oil prices.

The British Financial Times newspaper also quoted the head of the Canadian province of Alberta, Jason Kenny, as saying that Canada and the United States are considering imposing fees on Saudi and Russian oil imports if Moscow and Riyadh do not reach an agreement to reduce oil production.

The shale oil industry has been hit hard during the past few weeks by the drop in global crude oil prices to an average of $ 25 a barrel, which makes shale oil production ineffective.

The average output of a barrel of shale oil is twenty dollars, compared to an average of four dollars for other types of oil, while it reaches 2.5 dollars for the production of a barrel of Saudi oil.

Last week, Brent benchmark crude fell to an average of $ 25 a barrel, the lowest level since 2002.

The United States is the largest crude oil producer in the world with an average daily 13.1 million barrels per day, while its daily consumption is about 17 million.

A report by the American Oil Price site believes that the Trump administration has little power to persuade Saudi Arabia and Russia to end the price war, despite its attempts to succeed in its endeavors.

Damages
At a time when Oil Price considered that Saudi Arabia might not find a benefit in retreating from its strategy to flood the markets with oil, in light of the low prices in the markets and its need for resources to face the budget deficit, the report warned that the price war will harm both Saudi Arabia and Russia.

The report said that Saudi Arabia faces enormous pressure on the budget because of the low prices, and at the present time the Kingdom is focusing on the amount of production at the expense of prices, but this may not last forever.

As for Russia, it may also face a surplus in production in the absence of buyers, as it may demand a halt to production in view of the internal nature of its production, as well as a decline in the rates of operation of refineries in the European pipeline export market, according to the report quoting Goldman Sachs.