No
You wont be doing a differential backup in any case, the pst is a single
file, and its attribute is reset whenever outlook is opened, in other words
only a full backup will be done.
Have you used any of the archive options?

Nothing stops you from creating other PSTs and moving some of the data in
the main PST to those other PSTs so as to reduce its size.

I make a new .pst file each year, and call them 2006, 2007 etc then sort my
inbox by date and move all the old ones into the correct year.  If I want to
find a message that I got in 2004, I know which .pst to open.  If I guess
the year worng, I simply open the next one and look in that.  My current
.pst never gets big.

Looks like you'll have to start paying that online storage vendor for
more disk space or find another freebie provider that gives you more
space.  adrive.com gives you 50GB of free disk space but then they are
not specifically an online backup provider.  You do your own backups and
save the backup files to adrive.

Outlook requires write access each time it opens the .pst file.  The
.pst file will get updated everytime it is opened.  Your incremental
backup is looking for files that changed.  That means the .pst file will
have changed every time your incremental backup executes, so the whole
.pst file gets included in each incremental backup (as long as you open
Outlook more often than you run incremental backups).  "Online
differential backup" doesn't say what you are using to create the backup
files or what you selected to include in those incremental backups, or
even if it is a program that works with the online backup provider (so
you might instead be running local backups already and then copying the
backup files to online storage).

Online storage does not obviate the need for local backup storage (to
removable and securely protected media).  If the online storage provider
goes belly up, you can't at those files anymore.  If there is a network
problem (a host is down in the route between you and them, their servers
are too busy to handle yet another connect, or their service is down)
and you need the restored file(s) now, you can't get them from the
online storage provider.  Are your backups encrypted locally and then
saved up on their disks?  If not, your data is available for their
interrogation.  You sure that none of your e-mails or other files you
are storing there contain sensitive information, like credit card
numbers, social security number, company private information, etc?