Investing.com -- Saudi Arabia has announced a reduction in oil prices for its largest market, Asia, as the Organization of Petroleum Exporting Countries and aligned producers (OPEC+) begin to ease production restrictions.

State producer Saudi Aramco (TADAWUL: 2222 ) will decrease the price for its Arab Light crude to Asia by 40 cents a barrel for April, in what is the first reduction in three months. This cut is larger than the 15 cents a barrel decrease anticipated by traders and refiners, according to a survey by Bloomberg.

This price reduction follows a significant price increase in March. OPEC+, led by Saudi Arabia and Russia, has agreed to start increasing halted oil production next month. This decision comes in response to pressure from US President Donald Trump for lower prices and after several delays caused by market weakness.

Earlier this week, oil prices dropped as the planned output hikes are expected to add more barrels to an already oversupplied market. Additionally, a series of tariffs by the US threatens global consumption. These factors collectively led to Brent futures falling below $70 a barrel for the first time since October. Middle Eastern oil markets have also faced pressure following OPEC+’s production decision.

Despite refining margins still being weaker than processors would prefer this year, following a drop in 2024, Aramco’s Chief Financial Officer Ziad Al-Murshed expressed on an earnings conference call on Tuesday.

However, Chief Executive Amin Nasser remained optimistic about the market, stating that demand is still robust and is expected to reach a record high this year.

Saudi Aramco has set the Arab Light at a premium of $3.50 a barrel to regional benchmarks for April, down from $3.90 in March.

The state producer has also reduced all prices to northwest Europe and the Mediterranean, while keeping prices to the US steady.

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