Russian Oil Sold To India Below Price Cap

Russian Urals crude has been sold at wider discounts this month following the European ban on Russian oil imports, while India has bought oil well below the $60/bbl price cap agreed by the G7 and EU, market sources told Reuters.

• For some deals this month, the price for Urals in Indian ports, including insurance and delivery by ship, has fallen to around minus $12-$15 per barrel versus a monthly average of dated Brent, down from a discount of $5-$8 per barrel in October and $10-$11 in November, the sources said.
• The discounts mean oil is in some cases being sold at below overall production cost including local levies, industry sources said.
• The shortage of vessels suited for Russian winter weather has supported freight rates. Freight rates have risen to between $11-$19 a barrel compared with less than $3 per barrel before February.
• Reuters calculations showed discounts for Urals oil at Russia's western ports for sale to India under some deals have widened to $32-$35 per barrel when freight is not included in the price.
• Indian oil imports in November from Russia have risen for the fifth consecutive month to 908kbpd, up by 4% from November, marking Russia as the top oil supplier to India.