Russian producers have been selling their crude oil to India at prices below the G7 price cap of $60 per barrel, but since shipping costs are not included in this price ceiling, Russia has been overcharging for freight costs and getting more revenue from oil trade, a Financial Times analysis showed this weekend.
Newly established commodity trading firms incorporated in Hong Kong and the United Arab Emirates (UAE) have replaced trading and oil giants in handling Russian crude oil and products after the Russian invasion of Ukraine and the EU and G7 sanctions and price caps that followed.
China has gobbled up a record amount of Russian crude, adding some 2 million bpd to its strategic and commercial inventories last month.
Oil and gas revenues for the Russian budget slumped to $5.8 billion (528.6 billion Russian rubles) in June, down by 26.4% from the same month last year, data from Russia’s Finance Ministry showed on Wednesday.
Saudi Arabia on Monday extended its oil-export cut of 1 million barrels per day for another month and Russia said it will cut 500,000 bpd from its oil exports in August, in moves that could support prices at comfortable levels for producers.
India’s crude oil imports from Russia hit a new record high of 2.2 million barrels per day (bpd) in June, having risen in 10 consecutive months, per data from analytics firm Kpler cited by Bloomberg.
Crude oil prices moved modestly higher in Asia pre-noon trade today following the news that Saudi Arabia would extend its voluntary oil production cuts through August.
Uzbekistan has reached a deal with Russia’s Gazprom to buy 2.8 billion cubic meters of natural gas annually over the coming two years as part of a broader effort to prevent winter-time shortages.
Russia’s crude oil exports by sea fell slightly in the four weeks to June 18, but were still 250,000 barrels per day (bpd) higher compared to February, which serves as a baseline for the 500,000-bpd production cut Russia has promised this year.
Russia has enough gasoline to meet its domestic demand, Energy Minister Nikolai Shulginov said on Friday, downplaying the possibility that Moscow could limit gasoline exports.