Saudi Arabia to change oil pricing for European customers

Saudi Arabia plans to change the benchmark it uses to sell crude in Europe from July, in a bid to help refiners closely hedge crude purchases, agencies reported on Tuesday.

State-run Aramco will sell crude in Europe, Africa, and Latin America based on ICE Brent Settlement. The oil giant currently prices crude against the Brent Weighted Average (BWAVE).

The new pricing will be effective July 1, it was reported.

European refiners have complained that using a weighted average makes it tough to hedge their exposure to the benchmark.

“Saudi Arabia is confident that this enhancement will continue to provide a transparent, reliable and liquid market serving both parties,” Aramco said in a letter to European customers, cited by Bloomberg.