Russia’s crude oil shipments hit their highest level in three months, with more oil available for export after the country’s refineries began seasonal maintenance.
The four-week average of shipments increased by about 60,000 barrels per day in the week to October 6, reaching the highest level since early July.
Russian oil processing through most of September fell to the lowest level since June amid construction at plants across the country, trend that continued in the first days of this month.
The four-week increase in flows came despite shipments from Baltic and Asian ports falling over a seven-day period. According to Moscow, The country’s crude oil production was below the OPEC+ target last month.
The gross value of Russian crude oil exports fell to US$1.54 billion in the seven days to October 6, compared to US$1.68 billion in the period to September 29.and. The drop in weekly shipments was partly offset by the rise in average Russian crude oil prices, which were helped by a broad-based rise in global benchmarks amid concerns about the potential for the conflict between Iran and Israel. disrupt supplies in the Middle East.
The Russian state’s oil revenues recorded a small annual increase in September, which came at the expense of the country’s oil producers. The government offset falling energy prices by halving monthly subsidies to the nation’s crude producers. Oil remains a key source of funds for the Kremlin, that is trying to resist Western sanctions and cover the growing military cost of the invasion of Ukraine.
crude oil shipments
A total of 31 tankers loaded 23.58 million barrels of Russian crude oil in the week to October 6as shown by ship tracking data and reports from port agents. The volume was lower than the 26.17 million barrels shipped on 35 vessels the previous week.
This means that daily flows of Russian crude oil by sea in the week to October 6 fell by about 370,000 barrels to 3.37 million, giving up almost half of the previous week’s rise.
On the other hand, the four-week average, less volatile, rose 60,000 barrels per day, to 3.32 million, compared to 3.26 million the previous week.
Crude oil shipments so far this year are around 50,000 barrels per day, or 1.4%, below the average for all of 2023.
During the week, two cargoes of Kazakh crude oil KEBCO were loaded in Novorossiysk, on the Black Sea, and one in Ust-Luga, on the Baltic.
Russia ended its export targets at the end of May, opting instead to restrict production, in line with its partners in the OPEC+ oil producer group. The country’s production target has been set at 8,978 million barrels per day until the end of Novemberafter the planned relaxation of some production cuts was delayed for two months.
Moscow has also committed to further production cuts in October and November this year, and then between March and September 2025. to compensate for pumping above its OPEC+ quota earlier this year.
Russian data shows the country pumped slightly below its OPEC+ crude output target in September, following the group’s push to improve compliance with its supply deal. At 8.97 million barrels per day, the official production figure was 8,000 barrels per day below the country’s target.after taking into account the larger compensatory cut it agreed to make last month.
Export value
The gross value of Russian crude oil exports fell to $1.54 billion in the seven days to October 6, down from $1.68 billion in the period to September 29. The sharp drop in weekly flows was partly offset by a rise in weekly average prices for major Russian crude flows, which were boosted by a broader rise in oil prices amid rising tensions in the East. Half, as Israel studies its response to an Iranian missile attack.
Export values at Baltic ports rose about $1.50 a barrel weekly, while shipments from the Black Sea rose by about $2 a barrel. ESPO prices in the Pacific rose about US$1 compared to the previous week. Delivery prices in India also went up, about 2.10 dollars per barrel, according to figures from Argus Media.
Four-week average earnings rose slightly to about $1.47 billion a week, up from $1.46 billion in the period to September 29. The maximum of the four-week average, of US$2.17 billion per weekwas reached in the period until June 19, 2022.
During the first four weeks after the Group of Seven price cap on Russian crude oil exports came into force in early December 2022, the value of maritime flows fell to minimum of US$930 million dollars per week, but it soon recovered.
Asia
Observed shipments to Russia’s Asian customers, including those with no final destination, were stable at 3.14 million barrels per day in the four weeks to October 6. This figure is 3% lower than the average level recorded in April, when the recent peak was reached.
Around 1.31 million barrels of crude oil per day were loaded onto tankers bound for China. The Asian country’s maritime imports are boosted by some 800,000 barrels a day of crude oil supplied from Russia by pipeline, either directly, or through Kazakhstan.
Maritime traffic to India reached an average of 1.49 million barrels per daycompared to the revised 1.53 million as of September 29.
Both the Chinese and Indian figures are likely to rise as discharge ports are cleared for vessels that currently have no final destination indicated.
The equivalent of about 230,000 barrels a day was on ships calling at Port Said or Suez, Egypt. Those voyages typically end in ports in India or China and appear as “Unknown Asia” until the final destination is known.
The volumes of “Other unknowns”, of about 100,000 barrels per day in the four weeks up to October 6, are those of oil tankers with no clear destination. Most come from western Russian ports and transit through the Suez Canal, but some could end up in Türkiye. Others can be transferred from one ship to another.
Greece has extended naval maneuvers until November in an area that has been associated with the transfer of Russian crude oil. However, these naval maneuvers have not completely stopped the transfers of Russian crude oil from one ship to another in the area. The Alma supertanker recently received crude oil from two smaller tankers, Sagar Violet and Arlan, in a narrow channel located between two areas closed to navigation.
Europe and Türkiye
Maritime exports of Russian crude oil to European countries have ceased, with flows to Bulgaria halted late last year. Moscow also lost about 500,000 barrels a day of pipeline exports to Poland and Germany in early 2023.when these countries stopped buying.
Türkiye is now the only short sea market for shipments from Russia’s western ports, with flows in the 28 days prior to October 6 increasing to about 180,000 barrels a day.
