Iraq followed through with Saudi Arabia's announcement last week to increase crude prices for Asia. The new pricing will raise Basrah Light crude by 70 cents a barrel to a $1.10 premium over the regional benchmark based on the price list from the state oil marketer.
Saudi Arabia made an announcement last week that they will be making a unilateral production cut of 1 million barrel-a-day for February and March causing some crude markets tightening. This reduction also drove Brent crude to more than $55 a barrel last week.
With the OPEC+'s decision to keep production quotas unchanged for their members for the time being, this move by Saudi Arabia will have a positive effect for the coalition as a whole. Russia and Kazakhstan are pumping more crude than previously agreed and this will inadvertently be outweighed by Saudi Arabia's production cut.
OPEC+ decided on production cuts to restrain output amid slow demand and the coronavirus lockdowns which started during the second quarter of last year.
Aside from Basrah Light, Iraq also increased their prices for Basrah Medium and Basrah Heavy sales to Asia. Increased prices for Light and Medium barrels bound to the United States but kept Basrah Heavy unchanged while cutting down on prices for Europe by at least 80 cents a barrel.