Media reported a record decline in Russian oil prices.

Discounts on Russian Urals oil reach 20 dollars due to US sanctions

Discounts on Russian Urals oil in the ports of Primorsk and Novorossiysk have increased to nearly 20 dollars per barrel, attributed to recent US sanctions against major Russian oil companies.

According to “Kommersant”, as of November 10, the discounts on Urals oil stand at 19.4 dollars per barrel. This sharp increase occurred after US sanctions were imposed on October 23 against “Rosneft” and “Lukoil”. This figure is the highest this year. In early November, the price reduction was 13-14 dollars per barrel, and before the sanctions in October, it was 11-12 dollars. The highest discounts for Urals to Brent were in the second quarter of 2022, reaching 31.9 dollars per barrel, influenced by geopolitical risks following Russia’s invasion of Ukraine, and in the first quarter of 2023 – 30 dollars amid the EU embargo on sea shipments from Russia.

Market disruptions related to the sanctions have forced China, India, and Turkey to cut back on their purchases of Russian oil. The situation in the market remains tense: at the beginning of November, the spot market price for Brent was approximately 65.8 dollars per barrel, which significantly differs from previous prices.

Experts believe that prolonged sanctions may force Russia to seek new markets for its oil or reduce production volumes, which will have long-term consequences for the global energy market.