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China and India, the main customers of Russia's crude oil in recent months, have snapped up in April Russian cargoes at prices above the $60 per barrel price cap set by the G7, Reuters reports, citing traders and its own calculations.
Russia's flagship crude grade Urals is now trading above the $60 price cap and has headed mostly to India and China so far this month, per data from Refinitiv Eikon cited by Reuters.
India is estimated to account for over 70% of the Urals shipments in April, and China is receiving 20% of those shipments so far this month, according to Reuters estimates.
China and India haven't joined the so-called Price Cap Coalition of mostly Western nations that imposed a price cap on Russia's crude oil if the cargoes are using Western insurance, shipping, and financing.
Since the OPEC+ announcement of additional cuts through the end of the year, the price of Urals has moved higher, threatening the price cap imposed in a bid to hurt Russia's oil revenues.
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, according to Chinese customs data. 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 barrels per day (bpd) in January and February 2023.
India, for its part, is also boosting imports of Russian oil to record levels. In February, Russia remained India's top oil supplier for a fifth consecutive month.
More recently, Russian weekly crude oil exports by sea returned to above 3 million bpd in the week to April 14, bouncing back from an eight-week low in the previous week, data from vessel-tracking services compiled by Bloomberg showed earlier this week. Most of those exports are going to China and India.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews.