The Fall of Asian Premium, And the Rise of New Energy Corridors

Abstract

Analysts and officials in consumer countries have used the term "Asian Premium" to refer to the higher prices paid by Asian importers for oil from major exporters like OPEC members, who are primarily behind this discriminatory pricing mechanism, which is used to subsidize Western buyers at the expense of Asian buyers. This phenomenon has been observed for several decades, with prices for OPEC-pumped oil often being 10-15% higher in Asia than in other regions. But, reducing the "premium" for Asia due to the sanctions can be seen as an economic boost, an unintended consequence. Additionally, the sanctions have resulted in an increase in the price of natural gas for Europeans