Russia’s oil export revenue slips in October

The lower benchmark crude prices more than offset a shrinking discount for Russia’s crude grades versus North Sea Dated, the agency said in its latest Oil Market Report published on November 14.

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In volumes, total Russian oil exports dropped by 70,000 barrels per day (bpd) in October compared to September, and averaged 7.5 million bpd last month, due to lower refined product exports which more than offset higher exports of crude oil, according to the IEA’s estimates.

Russia’s ban on fuel exports affected product shipments at the end of September and early October. Russia enforced a three-week ban on diesel exports to countries other than four former Soviet states—Belarus, Armenia, Kazakhstan, and Kyrgyzstan.

Moscow partially lifted the ban on diesel exports on October 6, and seaborne exports resumed shortly after that. The ban was lifted on exports of diesel and gasoil delivered to seaports by pipeline, provided that the diesel producer supplies at least 50% of the diesel to the domestic market.

The temporary ban on exports of Russian diesel and heavy refinery maintenance were estimated to have reduced Russia’s diesel exports by sea by 11% in October compared to September.

Apart from gasoline and vacuum gas oil (VGO), the prices of all other Russian crude grades and products were above the G7 price caps, the IEA said in Tuesday’s report.

“The first US Treasury sanctions imposed under the G-7 price cap contributed to slightly weaker Russian crude prices in the latter half of the month due to rising shipping costs,” the agency added.

As a result of the stricter sanctions enforcement, shipping rates for transporting Russian crude have surged, traders have told Reuters.

Earlier this month, Russian government data showed that the average price of the flagship Russian crude grade, Urals, was $81.52 per barrel in October 2023. That’s higher than the average Urals crude price for the same month of last year, $70.62 per barrel.