99% of seaborne oil supplies from the Russian Federation cost above the price ceiling in October – Kommersant

In October, more than 99% of Russian seaborne oil supplies were sold at a price exceeding the oil ceiling set by the G7 countries at $60 per barrel. The average cost of a barrel of oil exported from Russia was $79.4 in October, reports Bloomberg with reference to data from a study conducted by the Kyiv School of Economics (KSE).

The agency notes that in recent months, Russia has learned to circumvent G7 restrictions by using a shadow tanker fleet with unidentified owners and insurance companies. It is reported that the US has already responded to this and introduced sanctions against five similar tankers, and also sent letters to companies around the world about the possible involvement of 100 vessels in the shadow fleet of the Russian Federation.

According to KSE research, in October, about 30% of all seaborne oil deliveries were carried out with the participation of companies from the G7 countries, the European Union or other Western countries. Under the terms of the introduced price ceiling, Western insurance companies are required to require a certificate from the trader that the oil being transported is traded below the ceiling price.

KSE believes that falsification of certificates is common among traders. According to the researchers, to make price ceilings more effective, it would be necessary to tighten penalties for organizations that violate restrictions, as well as provide insurance companies with a more reliable way to verify at what price a trader bought oil.

On December 5, 2022, the embargo on Russian oil came into force, and from the same day the price ceiling for oil from Russia was set at $60 per barrel. Since February 5, 2023, the European Union embargo on Russian petroleum products has been in effect. Ministry of Energy of the Russian Federation asserts, which was able to redirect the volumes of supplies of oil and petroleum products that fell due to the embargo. According to the International Energy Agency, revenue from Russian oil exports fell by $25 million in October to $18.34 billion.

Previously, the Financial Times, citing Western officials reported, that “almost none” of oil supplies from the Russian Federation by sea in October were carried out below the limit of $60 per barrel. According to the FT, because of this, the EU will instruct Denmark to inspect and possibly block tankers carrying Russian oil passing through its waters.

About the situation on the market – in the material “The tankers were rumbling at sea”.

Erdni Kagaltynov