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Price Of Russian Oil Falls Back To Western-Capped Levels

The price of a barrel of Urals grade crude oil shipping out of Russian ports has retreated to levels close to the G7 price cap after higher freight rates and falling Brent crude prices dragged it down, Reuters has calculated.

The G7 imposed a price cap of $60 on Russian crude oil, with penalties for insurers and carriers who deal in Russian crude above that specified cap. For months, however, Russia has shipped much of its crude oil well above the cap—but the price that a barrel of Urals can fetch is now falling along with the price of Brent and the rising costs of shipping after the U.S. sanctioned two tankers carrying Russian oil in October.

Shipping costs from Baltic Ports to India are now at $8 per trip, up from $5 million in September.

According to trading data compiled by Reuters, Urals crude oil shipping from Baltic ports heading for India at the end of this month and in early December fetched between $63 and $64 per barrel as of today—although still above the $60 price cap.

This is a far cry from the $81+ per barrel level seen for October loadings and even further from the $83+ level seen for September loadings.

This is in stark contrast to the situation in August that saw the price of Russian ESPO crude rising to an eight-month high and shrinking the discount for EPSO vs. Brent to its narrowest range since the embargo went into effect last December as strong demand out of India and China supported higher prices.

Meanwhile, the United States has continued to insist that the G7 price cap on Russian oil has significantly reduced revenue from oil during the first ten months of the cap.

By Julianne Geiger for Oilprice.com


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  • George Doolittle on November 11 2023 said:
    If need be the USA could stand up an entire euro based oil and natural gas energy system no different than has been done in the USA and Canada with support now even for Venezuela from the USA. Only Russia is raging away with World War 3 over there not Europe.

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