The value of Russian oil exports has reached its highest level since February 2022, averaging $2.42 billion per week in the period leading up to May 3.
This surge is attributed to an increase in supply volumes and higher oil prices, which, according to Bloomberg, were triggered by the conflict in Iran. The Middle East conflict has disrupted energy markets, compelling refineries to seek alternatives for lost barrels. Amid these developments, Washington eased sanctions on Russian oil, opening up some markets for Moscow.
Average four-week crude oil flows from Russia increased to 3.66 million barrels per day by May 3, marking the highest level since December and nearly 500,000 barrels per day more than in mid-April. The impact of previous Ukrainian drone strikes on key export ports, including Primorsk, Ust-Luga, and Novorossiysk, continues to diminish, allowing shipments to resume. However, a new attack on Primorsk on May 5 could affect operations next week.
Shifting Routes and Supply Volumes
India’s imports of Russian crude oil last month stood at approximately 1.5 million barrels per day. This figure is about 1.5 times higher than in February and included a record 13 cargoes of ESPO grade (Russia’s key Pacific export blend) loaded in April, compared to just three in February. Russia also made rare oil deliveries to the Philippines and Japan, with the latter receiving only its fourth cargo since the start of 2022.
The increase in flows has led to a rise in the volume of Russian oil at sea, reaching approximately 115 million barrels by May 5, up from 100 million three weeks prior. Most of this oil is in transit rather than idling on vessels, though Pacific cargoes bound for India spend longer at sea—averaging about three weeks—compared to roughly four days for those heading to China.
Source: Bloomberg Markets
