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    Saudi Arabia Selling Oil Cheap to Europe to Compete With Iran

    CC BY 2.0 / Paul Lowry / Oil Pump Jack
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    In its struggle for the global oil market, Saudi Arabia has offered enormous discounts on crude for Europe.

    The move came amid the ongoing spat between Riyadh and Tehran after protesters attacked the Saudi embassy in Tehran and the consulate in Mashhad following the execution of Shia cleric Nimr al-Nimr. In response, Saudi Arabia cut off diplomatic ties with Iran.

    Saudi state-owned oil company Aramco has lowered European oil prices by $0.06 and $0.02 a barrel. At the same time, prices for Asian countries rose by $0.06 a barrel while the price for the US stayed the same.

    The Saudi move appears to be part of its strategy to compete for European oil markets later this year when Iran is expected to increase oil exports after Western sanctions over its nuclear program are lifted, The Wall Street Journal reported.

    Before the EU imposed sanctions against Tehran in 2012, Italy and Spain imported 13 and 16 percent of oil from Iran respectively.

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    Tags:
    oil prices, oil market, Iran, Saudi Arabia
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