Prime Highlights:
Saudi Aramco hiked the price of diesel to SR1.66 ($0.44) per liter, effective January 1, 2025 which is an increase of 44.3% from January 2024.
Gasoline 91 and 93 are SR2.18 and SR2.33 a liter respectively.
Increase in diesel is a part of an annual review mechanism underpricing for Aramco, a process that commenced from 2022.
Key Background:
Saudi Aramco has hiked the price of diesel in Saudi Arabia to SR1.66 ($0.44) per liter, effective January 1, 2025. The price of diesel is now 44.3% higher than the starting price of the year 2024. It is the fourth such review since the annual review was part of its pricing mechanism initiated by Aramco in 2022.
Gasoline 91 is at SR2.18 per liter, and Gasoline 93 at SR2.33 per liter. Though diesel increased, the company has not changed gasoline prices. It is one of the policies whereby the prices have remained unchanged.
The diesel price setting is one of the general energy policies of Saudi Arabia. Pricing by Aramco was a new policy introduced in 2022. The policy created room for step-by-step upward adjustment of the fuel prices according to market forces. In January 2024, the company that had already taken its increment, had increased the diesel prices to SR1.15 per liter from SR0.75.
Although the new price is staggering as compared to the last year, Saudi diesel prices are low when compared to its many Arab neighboring states in the Gulf. In the United Arab Emirates, it costs $0.73 per liter. The same in Qatar costs $0.56 a liter. It costs $0.42 per liter in Bahrain and $0.39 in Kuwait.
Apart from the adjusted diesel prices, the website of Aramco also is a reporting center for the latest prices of every other fuel commodity. Kerosene is on the price list at SR1.33 per liter. LPG or Liquefied Petroleum Gas was quoted at SR1.04 per liter. OSPs for January 2025, released by Aramco on December 31, 2024, show that propane prices have fallen by $10 a ton, though the price decline is steeper than last month, which saw the butane price fall by $15 per ton.
Starting in January 2025, Saudi Aramco will implement price reductions for Arab Light crude oil sold to its Asian customers. Specifically, the official selling price (OSP) for Arab Light crude will be lowered by 80 cents per barrel. This price adjustment is also extended to other crude grades. These reductions highlight Saudi Aramco’s continued efforts to align its pricing strategy with global market conditions while advancing the broader objectives of the company within the energy sector.
