Russia is set to generate higher revenues from oil exports this year despite the price cap imposed on the country by the G7 and EU in response to the country’s invasion of Ukraine.
KYIV — Ukrainian military forces said Monday they managed to regain control over four strategically important oil and gas drilling platforms located in the Black Sea near the shores of Russian-occupied Crimea.
The decisions last week by Saudi Arabia to continue its 1 million barrel per day (bpd) production cut to the end of this year and by Russia to extend its 300,000 barrels per day export cut for the same period conspired to push oil prices to their highest level since last November.
Despite multi-layered international sanctions on Russia following its 24 February 2022 invasion of Ukraine, President Vladimir Putin’s ‘special energy project’ – developing the country’s massive gas and oil resources in the Arctic – took a major step forward last week as it was confirmed that the flagship Arctic LNG 2 will begin operations before the end of this year.
Despite higher oil prices and narrower discounts of Russian crudes to international benchmarks, Russia remained the single largest crude oil supplier to China in July, ahead of its OPEC+ partner Saudi Arabia, according to Chinese customs data.
Last year, Greece emerged as a new hub for Russian oil via ship-to-ship (STS) loadings shortly after the U.S. and Europe slapped heavy sanctions on Russian crude. At the height of the Russia-Greece trade, shipments of Russian fuel oil clocked in at nearly a million tonnes, several times the volumes before the sanctions.
Russia took control of the oil sector of the semi-autonomous region of Kurdistan (KRI) in northern Iraq in 2017 for four key reasons, as analysed in depth in my new book on the new global oil market order.
Russian export of crude oil and petroleum products to Africa has increased by 2.6 times over the past two years, President Vladimir Putin has disclosed.
Russian producers have been selling their crude oil to India at prices below the G7 price cap of $60 per barrel, but since shipping costs are not included in this price ceiling, Russia has been overcharging for freight costs and getting more revenue from oil trade, a Financial Times analysis showed this weekend.
Newly established commodity trading firms incorporated in Hong Kong and the United Arab Emirates (UAE) have replaced trading and oil giants in handling Russian crude oil and products after the Russian invasion of Ukraine and the EU and G7 sanctions and price caps that followed.