Russia’s flagship oil is moving ever closer to $60 per barrel cap

It’s getting increasingly difficult to assess the actual price of Russian crude, due to the emergence of a shadow fleet of vessels and trading companies with unclear affiliations. However, oil prices soared following last week’s shock announcement by OPEC+ to cut output, and global demand is expected to increase later this year, adding further upward pressure.

For much of the past year, Russian oil exports have surged, with much of it going to India and China. But increasingly tighter sanctions are starting to bite, and Russia has pledged to cut output through the end of the year. The country’s seaborne exports just saw their biggest weekly drop since December, tanker-tracking data compiled by Bloomberg show.

A gap of about $18 a barrel exists between the point of shipping and delivery of Urals cargoes in Argus’s data. The Russian grade shipped from the Baltic port Primorsk and Novorossiysk on the Black Sea costs about $55 a barrel.