The discount on Russian oil compared to the benchmark Brent in Asia has risen to its highest level in the past 12 months. This occurred after major Indian and Chinese refineries reduced their purchases due to new US sanctions imposed on key Russian oil companies. The price of Urals oil is now $4 per barrel lower than Brent, which is $2 more than before.
This is reported by Business • Media
Decrease in Russia’s Oil and Gas Export Revenues
According to estimates, Russia’s revenues from oil and gas sales in October decreased by 27% compared to the same period last year. This has significantly impacted the financial and military capabilities of the Kremlin, creating additional pressure on the state budget.
Asian Refineries’ Rejection of Russian Oil and Market Reaction
US President Donald Trump stated that oil exports from Russia have noticeably decreased following the sanctions imposed by Washington. The rejection of Russian oil by India has been particularly significant. According to Asian traders, the five largest refineries in India have already stopped purchasing oil from Russia, although these companies previously accounted for 65% of imports (approximately 1.2 million barrels per day) into the Indian market.
“US President Donald Trump stated that the volumes of oil exports from Russia have noticeably decreased after Washington’s sanctions. In particular, he noted that India has largely ceased purchasing Russian oil.”
Amid the reduction in supplies from Russia, Saudi Arabia, the world’s largest oil exporter, has lowered prices for all grades of oil for Asian clients. This decision may support Indian refineries, which, due to US sanctions, are forced to cancel orders for Russian oil. Reliance Industries, which was previously the largest importer of Russian oil in India, has already increased its purchases of crude from Saudi Arabia by 87% in October. The decrease in Saudi oil prices encourages Reliance and state-owned refineries in India to more actively import oil from Saudi Arabia instead of Russia.