Russia exported less crude oil after its refineries benefited from a temporary shift in Ukraine’s drone strike focus. The resumption of attacks on processing plants could lead to an increase in exports in the coming weeks.
Crude oil exports from Russia fell below the 4 million barrels per day mark for the first time in six weeks, dropping to 3.9 million barrels per day for the four weeks ending August 2, according to tanker tracking data compiled by Bloomberg. This represents the lowest shipment figure recorded by this method since mid-June.
Kyiv’s shift to targeting tankers in the Black and Azov Seas, as well as depots in western Russia, provided refineries with a brief respite in the second half of July. This allowed them to conduct maintenance work and increase processing volumes in recent weeks, likely reducing the amount of crude oil available for export.
Resumption of Attacks on Oil Refineries
However, the situation may change again as refineries were targeted once more last week. The Ryazan plant of Rosneft was hit shortly after resuming operations following an approximately two-month shutdown due to an attack in May.
Strikes were also carried out on the Volgograd refinery of Lukoil, which has a capacity of 300,000 barrels per day, an industrial facility in Ufa where three Bashneft refineries are located, and a Rosneft facility in Saratov.
Delays in Unloading and Transshipment
Five cargoes of Urals oil remain anchored off the Mediterranean port of Mersa-el-Khamra in Egypt. Unloading delays have increased: vessels now typically anchor for about a month and a half before unloading, compared to less than a week at the beginning of the year.
Separately, about 30 cargoes of Russian Arctic oil have stopped this year in the Riau Archipelago, east of Singapore. This area serves as a gathering point for “shadow fleet” vessels carrying sanctioned oil, and cargoes were transshipped to other vessels, often after weeks of anchoring. Many of these transshipments occurred when one or both vessels involved concealed their positions, complicating tracking efforts.
Meanwhile, cargoes of Sokol and Sakhalin Blend oil from Russia’s Far East may wait weeks to be transferred from shuttle tankers to ocean-going vessels. Some cargoes of the flagship ESPO oil are also idling for weeks near the main Pacific port of Kozmino after loading.
Increase in Export Value Despite Volume Decline
On average over four weeks, the gross value of Moscow’s exports rose to $1.69 billion per week for the 28 days ending August 2, which is $60 million per week more than the period ending July 26. A slight drop in crude oil volumes was more than offset by higher Russian oil prices, with the benchmark Urals grade rising by nearly $6 per barrel over the four-week period.
On this basis, export prices for Russian Urals oil loaded in the Baltic Sea rose by approximately $5.90 to $59.48 per barrel, while a $5.70 per barrel increase raised Black Sea oil prices to $58.55 per barrel. The price of Pacific ESPO oil rose more modestly by $2.10, averaging $68.23 per barrel. Prices for delivery to India rose for the second consecutive week, increasing by $7.10 to $77.22 per barrel. All prices are based on daily data from Argus Media.
On a weekly basis, the value of exports fell by approximately $410 million to $1.67 billion for the seven days ending August 2, with lower prices compounding the impact of the volume decline.
Observed shipments to Russian Asian customers, including those without a final destination, fell to 3.62 million barrels per day for the 28 days ending August 2, compared to the revised 3.76 million for the period ending July 26. While the volume of Russian crude on tankers heading to India continues to decline significantly, the volume on vessels that have not yet indicated a final destination has surged, which could alter this trend in the future. Tankers often show intermediate destinations, such as Suez or Port Sudan, until they cross the Arabian Sea, while some never indicate a final destination, even after berthing for unloading.
Source: Bloomberg
