The value of Russia's crude oil exports has plummeted by nearly 30% since the end of June as falling international benchmark prices are depressing the value of the cheaper Russian crude grades, Bloomberg has estimated.
Higher export volumes were unable to offset the slump in oil prices in recent weeks and Russia's flagship Urals crude is now trading below the $60 per barrel cap imposed by the EU and the U.S. if Russia is to use Western shippers, insurers, and financiers for moving the crude.
The decline in oil prices, with Brent Crude now to the low $70s per barrel -after settling one day early last week at a near-three-year low of below $70 - has inevitably led to a drop in the price of Russian crude.
The price of Urals dropped last week for a second consecutive week. The price fell by another $3 per barrel, resulting in even lower revenues for Russia despite an uptick in seaborne crude oil exports, Bloomberg's Julian Lee notes.
Shipments of crude oil from Russia's export terminals averaged 3.21 million barrels per day (bpd) for the four weeks to September 15, according to tanker-tracking data and reports from port agents compiled by Bloomberg. That's 80,000 bpd higher compared to the four-week average to the week of September 8.
Weekly seaborne exports - a more volatile figure considering the nature of crude loadings and shipments - rose by 110,000 bpd in the week to September 15, compared to the previous week, the data showed.
The higher export volumes, however, were offset by the plunge in oil prices, which diminished revenues for Russia.
Bloomberg's estimates put the four-week average oil revenues at their lowest level since February, edging lower to about $1.5 billion a week, Bloomberg's Lee wrote.
Russia is cutting production as part of the OPEC+ agreements, but it has overproduced so far this year and has pledged to compensate for said overproduction next year.
By Tsvetana Paraskova for Oilprice.com
Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More
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