Russia is ready to sell oil to ‘friendly countries’ at any price

Train wagons carry oil at the RN-Tuapsinsky Refinery in Tuapse, Russia – Photo: BLOOMBERG

Mr. Shulginov said in principle, Crude oil prices is in the $80-$150 per barrel bracket, but the country is more focused on ensuring the oil industry continues to function, according to Interfax.

According to Bloomberg news, before the war in Ukraine, Russia was the second largest oil exporter in the world, after Saudi Arabia. Russia exports nearly 5 million barrels of crude oil per day with a spot market value of more than $500 million.

Some crude oil is transported by pipeline directly to refineries in Europe and China. About 60% are shipped by sea.

However, the traditional markets in northwest Europe for Russian Baltic Sea crude exports are rapidly disappearing as buyers limit themselves to buying oil from Russia.

Half of the ships that docked at Primorsk and Ust-Luga ports in northwestern Russia last week are either headed for Asia or have not announced their final destination. However, most of the ships that have not announced their final destination appear to be heading to Asia via the Suez Canal, or will deliver to ships in the Mediterranean.

Bloomberg reports that the Mediterranean is starting to become a transit point for Russian crude oil from smaller vessels onto transcontinental mega-ships for delivery to Asia.

There are signs that Russia is looking to sell more oil, as its Urals oil has lost its appeal since the Russia-Ukraine conflict. However, Russia’s crude oil exports show no signs of starting to decline despite the loss of dear European customers.

According to Bloomberg News’ tracker of all crude oil leaving Russian export terminals on transboundary tankers, shipments in the seven days to April 8 continued to recover since last week, after when continuously decreasing since the war in Ukraine broke out.

Weekly export shipments reached nearly 4 million bpd in the first week of April 2022, the highest level this year. This is an increase of nearly a quarter from the previous week.

In Asia, according to Reuters news agency, thanks to the sharp price reduction policy following Western sanctions on Russian entities, India has purchased at least 13 million barrels of Russian crude oil since it started the process. Special military operation in Ukraine.

The amount of Russian crude oil supplied to India has increased sharply in recent times. According to Matt Smith, a leading oil expert at Kpler consultancy on Oil Price, since the beginning of March 2022, there have been 5 trains carrying 6 million barrels of Russian oil to India, equivalent to 50% of oil imports last year.

Financial returns can be the main cause. According to the International Energy Agency (IEA), high-quality Russian Urals oil was recently offered at a record high discount. Two weeks ago, Russia offered Urals bid to a number of corporations specializing in commodity trading such as Glencore or Vitol at a cheaper price of 25-30 USD/barrel than Brent oil.

Currently, India is the world’s third largest oil importer and consumer.