Russia seaborne crude exports fall to 2.9 mil b/d in H1 July: CAS

Russia's seaborne crude exports fell to 2.9 million b/d in the first half of this month, the lowest since December 2022 when the G7 price cap took effect, with refineries coming back online, OPEC+ production cuts and new EU sanctions, analysts at S&P Global Commodity Insights said July 17.

S&P Global Commodities at Sea data shows the country exported nearly 3.7 million b/d in January-June, suggesting a significant drop so far in July.

The decrease came as "nearly all targeted refineries return online following Ukrainian-led drone strikes," the analysts said, referring to a development that could route more crude for domestic processing at the expense of exports.

At its peak in March, there was over 1 million b/d of crude-processing capacity offline due to damages from drone attacks, involving eight different refinery locations, according to an analysis of Commodity Insights.

But no new attacks on refining assets have been reported since June 21, as US support encourages Ukraine to abide by Washington's preference that refining assets not be targeted, which could risk an upside shock to global oil prices.

The fall also came as Russia vowed to adhere more strictly to the production agreements of the OPEC+ alliance, which made several rounds of output cuts over the past two years including some 2.2 million b/d of voluntary cuts by leading members from mid-2023.

In June, Russia led a drop in non-OPEC production, cutting output by 140,000 b/d to 9.1 million b/d -- the lowest since December 2020 but above its quota of 8.98 million b/d, the Platts OPEC+ survey from Commodity Insights shows.

Moreover, the EU last month added Russia's largest shipping company Sovcomflot, and 17 oil tankers to its latest sanctions against Moscow, mirroring a move by the US earlier this year that temporarily disrupted Russian crude flows to top buyer India.

The 17 tankers shipped 22.4 million barrels of Russian-origin crude and products between the start of the year and June 24, when Brussels announced the sanctions, according to CAS data. Since then, only one of them, the NS Spirit, transported 264,000 barrels of Russian fuel oil and vacuum gasoil to Turkey.

Cargo flows

The analysts added that 3.1 million b/d of Russian crude were loaded during the week ending July 12, the lowest weekly figure in more than four months.

While crude flows to India reached 1.6 million b/d and China amounted to 879,000 b/d in the week, similar to the week-ago levels, crude bound for Turkey decreased by 430,000 b/d to a six-month low of 105,000 b/d, according to CAS.

With lower demand from Turkey, weekly liftings of Urals, Russia's flagship export grade, fell to 168,000 b/d to 1.4 million b/d, the second lowest of the year based on CAS data.

Platts, part of Commodity Insights, assessed Urals FOB Primorsk at a minus $12.20/b discount to Dated Brent on July 17. This was the smallest since Nov. 8, 2023.