Less European Based Vessel Moving Russian Oil in October m/m

The recent sanctions action taken by the US against two vessels found to be carrying Russian oil above the G7 price cap has pushed more volumes onto the ghost fleet according to Reuters sources.

• Reuters had previously reported that Greek shipowners in particular were reluctant to pick up Russian cargoes because of the extra scrutiny on whether Russian cargoes were abiding by sanctions.
• A higher crude price environment in the second half of this year and shrinking Russian discounts have brought the G7 price cap into scrutiny with many questioning if it was even being enforced.
• The proportion of Russian crude exports loaded onto EU-based vessels fell to around 20% in October from 35% in June according to Vortexa.
• Major oil companies, including Shell and BP, have already been avoiding tankers known to carry Russian crude according to Reuters sources.
• The Biden Administration seems to have little motivation to pull Russian barrels off the market while prices are soaring, and questions remain about potential tightening of oil sanctions on Iran over Hamas involvement while the sustainability of Venezuela’s recent deal is also under question.
• Russia is currently exporting oil in breach of 300,000 bpd export cuts based on Bloomberg tracking figures – though Novak says this now includes oil products which clouds the calculation.