Saudi Aramco is abandoning the West Texas Intermediate benchmark to price oil for sale to U.S. consumers because it is “disconnected” from the company’s customers, Chief Executive Officer Khalid Al-Falih said. The state owned oil company said on Oct. 29 it will start using the Argus Sour Crude Index published by Argus Media Ltd, from next year. Sour refers to the oil’s sulfur content.
“WTI has really become disconnected with the market where we sell and what we sell -- we sell sour crude, heavier sour crude in the U.S. Gulf coast, that is where most of our barrels in North America go,” al-Falih told reporters today in Rabigh, near the Red Sea town of Jeddah in Saudi Arabia. Aramco has priced its U.S. deliveries against WTI, a light, sweet crude delivered at Cushing, Oklahoma, since 1994. The price is determined by oil futures traded on the New York Mercantile Exchange and published by Platts, the energy- information division of McGraw Hill Cos.....Read the entire article.
