Russia’s Seaborne Oil Exports Dip But Remain High

• Russia’s four-week average seaborne export volumes for crude oil fell last week for the first time in six weeks.
• Russia’s seaborne oil export volumes are still significantly higher than in February when the country announced a 500,000 bpd cut.
• Both the IEA and Bloomberg say there is no evidence that Russia is reducing production as promised.

Russia’s crude oil exports by sea fell last week for the first time in six weeks, but they are still much higher than in February, when Russia announced a production cut of 500,000 barrels per day (bpd), tanker-tracking data monitored by Bloomberg showed on Tuesday.

In the week to May 28, four-week average crude oil exports fell by 180,000 bpd to 3.64 million bpd, for the first dip in four-week average seaborne export volumes in six weeks, according to the data reported by Bloomberg’s Julian Lee.  

Despite the slight drop in exports, Russian crude shipments are estimated to be 1.4 million bpd higher than at the end of 2022 and 270,000 bpd higher compared to February 2023, the baseline for Russia’s 500,000-bpd production cut, per Bloomberg’s calculations.

Last week, a Bloomberg analysis of shipping data showed that oil shipments out of Russia hadn’t dropped in recent months despite the Russian pledge to cut production.

Russia has said that the 500,000 bpd cuts will now extend until the end of 2023, but crude oil export data in recent weeks do not reflect any cuts—on the contrary, Russian crude oil exports by sea have been rising.

Earlier this month, reports emerged that Russian Deputy Energy Minister Pavel Sorokin sought to convince Western analysts in a rare call that Russia is indeed reducing its oil production by 500,000 bpd.

But earlier this month, the International Energy Agency (IEA) said that Russia had failed so far to cut its oil production by 500,000 bpd as promised, and it may even be looking to boost output to compensate for lost revenues.

Russian crude oil and oil product exports continue to prove resilient, with exports hitting in April the highest level since the invasion of Ukraine, at 8.3 million bpd, the IEA said in its closely-watched Oil Market Report for May.

By Charles Kennedy for Oilprice.com

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