What is the difference in the commodity price of oil and the price Saudi Arabia sells it for?

Is it close to the same price? What factors influence the difference, if any?

One Response to “What is the difference in the commodity price of oil and the price Saudi Arabia sells it for?”

  1. csanda Says:

    There is no "commodity price of oil" because crude oil is different from oil well to oil well. Some is "sweeter" with less sulfur content and some is "sour" with more sulfur. Some "light" oil is easy to refine into distillates, while other is "heavy" oil with more heavy-oil content.

    Saudi Arabia is known for its easy-to-reach, but heavy sour crude oil. Saudi Crude typically trades at a significant discount compared to other oils. Then again, Saudi also has some very light, sweet crude wells.

    According to today’s Bloomberg price, Heavy Sour Arabian crude is US$36.76/bbl (February contract), while Saudi Super Light costs US$46.90/bbl for the February delivery contract. This contrasts to Brent at 45.01 (which is a light sweet from the North Sea) and West Texas Intermediate, which is a (medium sweet from the Gulf of Mexico and the US Southwest, but sold at the Cushing depot) at US$41.50. West Texas Intermediate is usually used as the world benchmark, but Europeans use Brent as the benchmark.