Russian oil freight charges to India ease additional, proposed EU curbs might reverse pattern

The European Union has put ahead a brand new sanction package deal in opposition to Russia over Ukraine and proposed to decrease the Group of Seven nations’ value cap on Russian crude oil to $45 a barrel from $60 a barrel.

The G7 international locations and the EU, imposed the $60 cap on Russian oil in late 2022, limiting entry to Western transport and insurance coverage companies for above-cap purchases in a bid to curb Moscow’s revenues.

However, as the worth of Russia’s flagship Urals crude has fallen beneath the cap, Western shipowners have been capable of return to its oil market.

Urals crude value estimates in Russia’s ports have stabilised beneath $60 per barrel since early April, permitting extra Western transport firms, primarily Greek, to renew transport companies, growing tanker availability and placing freight charges beneath strain.

By Wednesday, the price of Urals oil loaded from the Baltic Sea port of Primorsk was about $54.72 per barrel.

The value of transport Urals oil from the Baltic ports, together with Ust-Luga, to India fell to between $5.5 million and $5.7 million from about $6 million per one-way cargo on common in April and May, and about $8 million early in March.

Russian crude transport charges rose sharply after a brand new spherical of U.S. sanctions on Russian vitality pursuits unveiled in January took impact. Russian oil sellers had been pressured to search for new tankers to exchange these hit by sanctions.

Freight charges nonetheless stay above ranges in January, when the price of transport Russian crude from the Baltic ports to India was between $4.7 million and $4.9 million per one-way cargo.

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