Russia's crude oil exports by sea have held above the 3 million barrels per day (bpd) mark in the past six weeks, after the EU ban on fuel imports from Russia took effect and after Moscow said it would lower its production by 500,000 bpd, tanker-tracking data compiled by Bloomberg shows.
In the most recent week to March 24, Russia's seaborne crude oil exports fell by 123,000 bpd but were still above 3 million bpd, at 3.11 million bpd, per the data cited by Bloomberg's Julian Lee.
While weekly shipments can be very volatile, tanker tracking in the six-week period to March 24 also showed a similar small decline in Russian shipments. This suggests that Russian crude oil exports have held resilient this year, and the voluntary production cut hasn't shown yet in Russia's crude exports to the global market.
Most Russian exports are headed to China, India, or "unknown destinations" in Asia, which, history shows, usually means that the cargoes end up in one of the two biggest Asian importers of crude.
Russia was the single largest crude oil supplier to China in January and February, overtaking Saudi Arabia which was the number-one supplier of oil to China last year.
As China accelerated the buying of cheap Russian crude oil at discounts to international benchmarks, Chinese imports of crude from Russia jumped by 23.8% year over year to 1.94 million bpd in January and February 2023, per data by China's General Administration of Customs cited by Reuters.
Russia, for its part, said last week it will continue its 500,000-bpd crude oil production cut through the end of June this year. Initially, Russia intended to cut that amount from its production in March.
"It remains to be seen if there will be sufficient appetite for Russian oil products now that the price cap is in place or if its production will start to fall under the weight of sanctions," the International Energy Agency (IEA) said in its Oil Market Report for March.
"Revenues are already dwindling," the agency noted.
By Tsvetana Paraskova for Oilprice.com
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Comments
Russian crude exports are bound to decline a bit with Russia cutting production by 500,000 barrels a day (b/d) from March to the end of June this year.
In January, Russian exports of crude and petroleum products hit 8.2 mbd or 2.5% above its pre-Ukraine level of 8.0 mbd. Moreover, Russia displaced Saudi Arabia and Iraq to become the largest crude supplier to China (1.94 mbd) and India (1.62 mbd) respectively with exports to the two countries totalling 3.56 mbd.
Dr Mamdouh G Salameh
International Oil Economist
Global Energy Expert