Russian oil flows are steadily rising again after months of careful compliance with a pact with Saudi Arabia to keep barrels off the world market.
Seaborne crude oil exports recovered in the seven days to October 15, pushing four-week average flows to the highest level in more than three months.
About 3.51 million barrels per day of crude oil were shipped from Russian ports last week, an increase of about 285,000 barrels per day from the previous seven days, tanker tracking data from Bloomberg shows. That lifted the less volatile four-week average to about 3.36 million barrels per day.
The increase was due to a rise in Black Sea flows to their highest level in six weeks and a recovery in shipments from the Arctic port of Murmansk after a slump the week before.
Deputy Prime Minister Alexander Novak said in early August that Moscow would extend export restrictions until the end of the year at a level of 300,000 barrels per day below the May-June average. Bloomberg calculations indicate that shipments through ports should now be around 3.28 million barrels per day.
Since early September, average four-week shipments have increased against this target, exceeding this target by approximately 80,000 barrels per day in the most recent period. That said, compliance to date has been good compared to the country’s past performance against OPEC+ targets. Since the export restriction was introduced in early August, flows have averaged about 15,000 barrels per day below required levels, assuming pipeline deliveries remain unchanged.
The volume increase boosted the Kremlin’s weekly revenue from oil export duties, while the four-week average rose for the 11th week in a row, marking a new high for the period since mid-January.
Russia’s rising oil revenues have called into question the effectiveness of the price ceiling imposed on Russian exports by the Group of Seven countries and the European Union, which are supposed to limit them. The U.S. Treasury Department responded by imposing sanctions on two tankers accused of carrying cargoes sold at prices above the $60 per barrel ceiling. The sanctions mark the first time there have been attempts to enforce the limit since it came into effect in December.
Russian oil refineries are increasing daily processing rates as October progresses. Oil processing in the country rose the most in more than a month in the week ending October 11. But ongoing maintenance and temporary diesel export restrictions, now lifted, left rates totaling about 150,000 barrels per day below average for most of September during the October 1-11 period.
Flows by destination
Russia’s seaborne crude oil supply rose in four weeks to October 15 and averaged 3.36 million barrels per day. That is the highest since July 4 and up from 3.26 million barrels per day in the period to October 8. Shipments remain about 220,000 barrels per day below April-June highs.
All figures exclude loads identified as Kazakhstan’s KEBCO grade. These are KazTransoil JSC shipments that pass through Russia for export via Novorossiysk and the Baltic port of Ust-Luga and are not subject to European Union sanctions or a price cap.
The Kazakh barrels are mixed with crude oil of Russian origin to create a uniform export quality. Since the Russian invasion of Ukraine, Kazakhstan has renamed its cargoes to distinguish them from those shipped by Russian companies.
Asia
Observed shipments to Russian Asian customers, including customers without a final destination, increased for a third week. Supply rose to 2.95 million barrels per day in the four weeks to October 15, from a revised 2.86 million barrels per day in the period to October 8. That is still well below the peak of about 3.6 million barrels per day in May. .
Even if all cargoes on ships without an initial destination end up in India, shipments to the country will still be around 450,000 barrels per day, or 21% less than the high in May. Adding the “Asia Unknown” and “Other Unknown” volumes to the total for India, this amounts to 1.7 million barrels per day in the four weeks to October 15. That is the highest number in fifteen weeks, but lower than the highest level of 2.15 million barrels. barrels per day in the period until May 21.
The equivalent of about 210,000 barrels per day was on ships signaling Port Said or Suez in Egypt, or expected to be transferred from one ship to another off the South Korean port of Yeosu. These voyages typically end at ports in India or China and appear in the chart below as ‘Unknown Asia’ until a final destination becomes apparent.
The ‘Other Unknown’ volumes, which amount to around 260,000 barrels per day in the four weeks to October 15, come from tankers with no clear destination. Most of these cargoes come from Russia’s western ports and pass through the Suez Canal, but some could end up in Turkey. Others could be transferred from one ship to another, with most such transfers now taking place in the Mediterranean.
Europe
Russia’s seaborne crude oil exports to European countries fell to a 14-week low of around 125,000 barrels per day in the 28 days to October 15, with Bulgaria the only destination. These figures do not include shipments to Turkey.
A market that consumed around 1.5 million barrels of short-haul crude oil per day from export terminals in the Baltic, Black Sea and Arctic has been almost completely lost, replaced by long-haul destinations in Asia that are much more expensive and time-consuming to serve.
Exports to Turkey, Russia’s only remaining Mediterranean customer, rose to around 290,000 barrels per day in the four weeks to October 15. That is the highest in eleven months. Supply topped 425,000 barrels per day in October 2022 before falling sharply after a Group of Seven price cap came into effect in early December.
The jump in flow comes after Lukoil resumed deliveries to Azerbaijan’s Star refinery in Aliaga. Delivery is expected to be around 100,000 barrels per day, equivalent to half the refinery’s capacity.
Supplies to Bulgaria, now Russia’s only Black Sea crude market, fell to a six-week low of around 125,000 barrels per day. The high import levels in recent weeks have come despite lawmakers recently passing a motion to end Bulgaria’s dependence on Russian crude oil earlier than allowed under a European Union import ban.
Total flows of Russian crude recovered, making up more than half of the previous week’s decline. Seaborne exports averaged 3.51 million barrels per day in the seven days to October 15. The increase of about 285,000 barrels per day was driven by higher flows from the Arctic and Black Sea.
The figures exclude volumes from Ust-Luga and Novorossiysk, identified as Kazakhstan’s KEBCO grade.
Ship tracking data is compared with reports from port agents and with flows and ship movements reported by other information providers, including Kpler and Vortexa Ltd.
Export income
Inflows from the crude oil export tax to the Kremlin’s war chest rose to $80 million in the seven days to October 15, while the four-week average income rose to $73 million. The four-week average set a new high for the period since mid-January. Rising oil prices and the recovery of financial flows both contribute to the increase in receipts.
The Russian government calculates oil taxes – including export duties – using a discount to the global benchmark Brent, which sets the floor price for the country’s crude oil for budget purposes. If Russian oil above that threshold, the Ministry of Finance uses the market price for tax calculations, as has been the case in recent months. The discount used to calculate taxes including export duties is set at $20 per barrel for September and subsequent months.
Export receipts
The excise rate for October is set at $3.26 per barrel, based on an average Urals price of $77.03 during the calculation period between August 15 and September 14. That was $11.60 per barrel lower than Brent over the same period. October’s excise rate marks a new high for the year. The rate for November is set at $3.57 per barrel, based on an average Ural price of $83.35 during the calculation period between September 15 and October 14. That was about $7.70 per barrel lower than the Brent price in the same period. November’s excise rate marks a new high for the year.
Flows from origin to location
The following graphs show the number of ships leaving each export terminal and the destinations of raw cargo from the four export regions.
A total of 32 tankers loaded 24.6 million barrels of Russian crude in the week to October 15, according to shipping data and port agent reports. That is 2 million barrels more than the week before.
A jump in supplies from Ust-Luga in the Baltic Sea more than offset the drop in the number of ships leaving nearby Primorsk.
Destinations are based on where ships indicate they are sailing to at the time of writing, and some will almost certainly change as the journey progresses. All figures exclude loads identified as Kazakhstan’s KEBCO grade.
The total volume of ships loading Russian crude from the Baltic terminals remained unchanged, averaging 1.56 million barrels per day for a third week.
Shipments of Russian crude from Novorossiysk rose to 625,000 barrels per day, equaling the highest level since the week ending July 2.
Two cargoes of Kazakh crude oil were loaded at the port this week, compared to one cargo in the previous seven days.
Two Suezmax tankers completed loading cargoes at the Arctic port of Murmansk in the week to October 15, boosting flows to around 285,000 barrels per day.
At the end of the week, two tankers drifted outside the port, waiting to load.
Ten tankers loaded at the three Russian export terminals in the Pacific, two fewer than the week before. The volume of crude oil shipped from the region fell to just over 1 million barrels per day, down 200,000 barrels per day from the previous seven days.
The drop in flows was caused by fewer ships loading Sokol grade from the De Kastri terminal and no tankers completing loading of Sakhalin Blend crude. Shipments from the Sakhalin Island terminal run every other week at one o’clock.
The volumes going to unknown destinations are Sokol cargoes currently being transported from the loading terminal in De Kastri to an area off the South Korean port of Yosu. Most of these end up in India.
Seaborne crude oil exports recovered in the seven days to October 15, pushing four-week average flows to the highest level in more than three months.
About 3.51 million barrels per day of crude oil were shipped from Russian ports last week, an increase of about 285,000 barrels per day from the previous seven days, tanker tracking data from Bloomberg shows. That lifted the less volatile four-week average to about 3.36 million barrels per day.
The increase was due to a rise in Black Sea flows to their highest level in six weeks and a recovery in shipments from the Arctic port of Murmansk after a slump the week before.
Deputy Prime Minister Alexander Novak said in early August that Moscow would extend export restrictions until the end of the year at a level of 300,000 barrels per day below the May-June average. Bloomberg calculations indicate that shipments through ports should now be around 3.28 million barrels per day.
Since early September, average four-week shipments have increased against this target, exceeding this target by approximately 80,000 barrels per day in the most recent period. That said, compliance to date has been good compared to the country’s past performance against OPEC+ targets. Since the export restriction was introduced in early August, flows have averaged about 15,000 barrels per day below required levels, assuming pipeline deliveries remain unchanged.
The volume increase boosted the Kremlin’s weekly revenue from oil export duties, while the four-week average rose for the 11th week in a row, marking a new high for the period since mid-January.
Russia’s rising oil revenues have called into question the effectiveness of the price ceiling imposed on Russian exports by the Group of Seven countries and the European Union, which are supposed to limit them. The U.S. Treasury Department responded by imposing sanctions on two tankers accused of carrying cargoes sold at prices above the $60 per barrel ceiling. The sanctions mark the first time there have been attempts to enforce the limit since it came into effect in December.
Russian oil refineries are increasing daily processing rates as October progresses. Oil processing in the country rose the most in more than a month in the week ending October 11. But ongoing maintenance and temporary diesel export restrictions, now lifted, left rates totaling about 150,000 barrels per day below average for most of September during the October 1-11 period.
Flows by destination
Russia’s seaborne crude oil supply rose in four weeks to October 15 and averaged 3.36 million barrels per day. That is the highest since July 4 and up from 3.26 million barrels per day in the period to October 8. Shipments remain about 220,000 barrels per day below April-June highs.
All figures exclude loads identified as Kazakhstan’s KEBCO grade. These are KazTransoil JSC shipments that pass through Russia for export via Novorossiysk and the Baltic port of Ust-Luga and are not subject to European Union sanctions or a price cap.
The Kazakh barrels are mixed with crude oil of Russian origin to create a uniform export quality. Since the Russian invasion of Ukraine, Kazakhstan has renamed its cargoes to distinguish them from those shipped by Russian companies.
Asia
Observed shipments to Russian Asian customers, including customers without a final destination, increased for a third week. Supply rose to 2.95 million barrels per day in the four weeks to October 15, from a revised 2.86 million barrels per day in the period to October 8. That is still well below the peak of about 3.6 million barrels per day in May. .
Even if all cargoes on ships without an initial destination end up in India, shipments to the country will still be around 450,000 barrels per day, or 21% less than the high in May. Adding the “Asia Unknown” and “Other Unknown” volumes to the total for India, this amounts to 1.7 million barrels per day in the four weeks to October 15. That is the highest number in fifteen weeks, but lower than the highest level of 2.15 million barrels. barrels per day in the period until May 21.
The equivalent of about 210,000 barrels per day was on ships signaling Port Said or Suez in Egypt, or expected to be transferred from one ship to another off the South Korean port of Yeosu. These voyages typically end at ports in India or China and appear in the chart below as ‘Unknown Asia’ until a final destination becomes apparent.
The ‘Other Unknown’ volumes, which amount to around 260,000 barrels per day in the four weeks to October 15, come from tankers with no clear destination. Most of these cargoes come from Russia’s western ports and pass through the Suez Canal, but some could end up in Turkey. Others could be transferred from one ship to another, with most such transfers now taking place in the Mediterranean.
Europe
Russia’s seaborne crude oil exports to European countries fell to a 14-week low of around 125,000 barrels per day in the 28 days to October 15, with Bulgaria the only destination. These figures do not include shipments to Turkey.
A market that consumed around 1.5 million barrels of short-haul crude oil per day from export terminals in the Baltic, Black Sea and Arctic has been almost completely lost, replaced by long-haul destinations in Asia that are much more expensive and time-consuming to serve.
Exports to Turkey, Russia’s only remaining Mediterranean customer, rose to around 290,000 barrels per day in the four weeks to October 15. That is the highest in eleven months. Supply topped 425,000 barrels per day in October 2022 before falling sharply after a Group of Seven price cap came into effect in early December.
The jump in flow comes after Lukoil resumed deliveries to Azerbaijan’s Star refinery in Aliaga. Delivery is expected to be around 100,000 barrels per day, equivalent to half the refinery’s capacity.
Supplies to Bulgaria, now Russia’s only Black Sea crude market, fell to a six-week low of around 125,000 barrels per day. The high import levels in recent weeks have come despite lawmakers recently passing a motion to end Bulgaria’s dependence on Russian crude oil earlier than allowed under a European Union import ban.
Total flows of Russian crude recovered, making up more than half of the previous week’s decline. Seaborne exports averaged 3.51 million barrels per day in the seven days to October 15. The increase of about 285,000 barrels per day was driven by higher flows from the Arctic and Black Sea.
The figures exclude volumes from Ust-Luga and Novorossiysk, identified as Kazakhstan’s KEBCO grade.
Ship tracking data is compared with reports from port agents and with flows and ship movements reported by other information providers, including Kpler and Vortexa Ltd.
Export income
Inflows from the crude oil export tax to the Kremlin’s war chest rose to $80 million in the seven days to October 15, while the four-week average income rose to $73 million. The four-week average set a new high for the period since mid-January. Rising oil prices and the recovery of financial flows both contribute to the increase in receipts.
The Russian government calculates oil taxes – including export duties – using a discount to the global benchmark Brent, which sets the floor price for the country’s crude oil for budget purposes. If Russian oil above that threshold, the Ministry of Finance uses the market price for tax calculations, as has been the case in recent months. The discount used to calculate taxes including export duties is set at $20 per barrel for September and subsequent months.
Export receipts
The excise rate for October is set at $3.26 per barrel, based on an average Urals price of $77.03 during the calculation period between August 15 and September 14. That was $11.60 per barrel lower than Brent over the same period. October’s excise rate marks a new high for the year. The rate for November is set at $3.57 per barrel, based on an average Ural price of $83.35 during the calculation period between September 15 and October 14. That was about $7.70 per barrel lower than the Brent price in the same period. November’s excise rate marks a new high for the year.
Flows from origin to location
The following graphs show the number of ships leaving each export terminal and the destinations of raw cargo from the four export regions.
A total of 32 tankers loaded 24.6 million barrels of Russian crude in the week to October 15, according to shipping data and port agent reports. That is 2 million barrels more than the week before.
A jump in supplies from Ust-Luga in the Baltic Sea more than offset the drop in the number of ships leaving nearby Primorsk.
Destinations are based on where ships indicate they are sailing to at the time of writing, and some will almost certainly change as the journey progresses. All figures exclude loads identified as Kazakhstan’s KEBCO grade.
The total volume of ships loading Russian crude from the Baltic terminals remained unchanged, averaging 1.56 million barrels per day for a third week.
Shipments of Russian crude from Novorossiysk rose to 625,000 barrels per day, equaling the highest level since the week ending July 2.
Two cargoes of Kazakh crude oil were loaded at the port this week, compared to one cargo in the previous seven days.
Two Suezmax tankers completed loading cargoes at the Arctic port of Murmansk in the week to October 15, boosting flows to around 285,000 barrels per day.
At the end of the week, two tankers drifted outside the port, waiting to load.
Ten tankers loaded at the three Russian export terminals in the Pacific, two fewer than the week before. The volume of crude oil shipped from the region fell to just over 1 million barrels per day, down 200,000 barrels per day from the previous seven days.
The drop in flows was caused by fewer ships loading Sokol grade from the De Kastri terminal and no tankers completing loading of Sakhalin Blend crude. Shipments from the Sakhalin Island terminal run every other week at one o’clock.
The volumes going to unknown destinations are Sokol cargoes currently being transported from the loading terminal in De Kastri to an area off the South Korean port of Yosu. Most of these end up in India.
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