Saudis to Change Oil Price Formula

Saudi Aramco plans to change the formula used to price its long-term crude oil sales to Asia later this year, multiple trade sources said on Wednesday.  

The new formula will be based on the average monthly prices of Oman crude futures traded on Dubai Mercantile Exchange and Platts cash Dubai prices, instead of the average of Oman and Dubai prices assessed by global pricing agency S&P Global Platts, they said, Reuters reported.

The change could take place from October, one of the sources said.

Saudi Aramco is expected to officially notify customers in Asia on Wednesday, the sources said. The company could not be immediately reached for comment.  Saudi Aramco’s much-hyped initial public offering is most likely to take place in 2019.

Since the Saudis initially floated the idea to list 5% in their state oil giant, officials had been insisting that IPO will take place in the second half of 2018, until in March al-Falih hinted that there might be a delay and the share sale could slip to 2019.