Saudi Arabia has raised the premium for its oil to a record $19.50 a barrel, the highest in over two decades, as the Iran conflict strains global energy supplies. State-run Saudi Aramco will charge Asian customers this premium on Arab Light crude, its main grade, surpassing the previous $10 cap. This marks a significant increase across all Saudi oil grades to every destination.

Customers in Europe will pay $24-$30 over the Brent benchmark, currently around $108 a barrel. The move follows Aramco redirecting exports via the Red Sea due to Iranian threats to the Strait of Hormuz, a vital oil chokepoint. Shipments through the strait remain heavily restricted, with only limited exceptions reported.

Aramco managed only about 50% of normal March volumes, forcing increased use of the Yanbu west coast port. The reduced Gulf exports most impact Asian refineries needing Middle Eastern sour crude. The Opec+ cartel's symbolic production increase fails to address the bottleneck behind the strait.