OPEC Slashes Discount for Crude

The Organisation of the Petroleum Exporting Countries, the oil cartel, has raised the price of its own oil to the highest level in a year, while publicly promising to tackle the high cost of oil at this week’s meeting in Vienna.

Emboldened by strong demand and a high oil price that has yet to have a significant impact on global economic growth, several of Opec’s biggest Middle Eastern producers last week further increased the prices they charge US and European traders and refiners for their oil.

The decision to increase the costs of actual crude oil from the Middle East – led by Saudi Arabia, the world’s largest oil producer – has gone largely undetected because New York and London oil futures prices, the world’s benchmarks, have remained almost the same. What has changed is the level of discount to international futures benchmark prices at which the Middle East countries sell their crude to the US and Europe.
Financial Times