The discount for Russian Urals oil on a FOB basis for cargoes loading from the Baltic port of Primorsk in April narrowed to $15-$17 per barrel versus dated Brent from about $24-$27 per barrel in the second half of March, as falling freight rates reduced costs for Russian sellers, according to Reuters calculations.
Urals prices in Russian ports have stayed near 12-year highs of around $100 per barrel, supported by strong Brent prices, softer freight rates and firm premiums that are boosting Russian oil producers' revenues, LSEG data shows.
The price of physical crude oil cargoes for prompt delivery to Europe hit a record high near $150 a barrel on Monday as global demand stayed strong amid disruptions to supplies through the Strait of Hormuz caused by the U.S.-Israeli war with Iran.
Russia's Urals oil premiums stayed firm in India as trading of May-delivery cargoes continues, despite the U.S. waiver expiration, three sources said, adding that softer freight rates help sellers' profits.
Premiums for Urals oil delivered to Indian ports were $7-$9 per barrel above dated Brent on a DAP (delivered at port) basis, in line with estimates for April-loading cargoes sold after the recent price rise, the sources said, adding that prices vary depending on deal terms and the seller.
Freight rates eased last week to $18-$19 million for a Suezmax voyage from Russian Baltic ports to India, while the cost of shipping Aframax cargoes from Primorsk to India fell to about $16 million in some cases, from above $20 million last month, traders said.
Russia's revenues from crude oil and refined products rose in March, rebounding from February when they fell to their lowest level since the start of the Ukraine conflict in 2022, as prices surged due to the Iran war, the International Energy Agency said on Tuesday. Firmer Urals prices in Russian ports will keep supporting Moscow's revenues in April.
Indian refiners continued buying Russian oil for May-delivery, despite the end of the 30-day U.S. sanctions waiver which allowed purchases of Russian oil already seaborne, traders said.
(Reuters)