Freight rates for Russian oil shipments from Baltic ports to India are falling further in April from recent highs, as Urals crude trades well below the $60 price cap, increasing tanker availability, two traders said.
The Group of Seven countries, along with the EU, imposed a $60-per-barrel price cap on Russian oil in late 2022, restricting access to Western shipping and insurance services for above-cap purchases in a bid to curb Moscow’s war funding.
The cost of shipping Urals oil from the Baltic ports of Primorsk and Ust-Luga to India fell to some $6 million per one-way shipment on average from $7 million late last moth and a 12-month high of some $8 million early in March.
Global oil prices fell early in April, which pushed the price of Urals crude in Russia’s ports below $60 per barrel, allowing more Western shipping companies to resume services for Russian oil, including freight.
As of Thursday, the cost of Urals oil loaded from the port of Primorsk was about $53.5 per barrel. (URL-PRMSK)
Russian crude shipping rates rose sharply after a new round of U.S. sanctions on Russian energy interests announced in January came into effect. Russian oil sellers were forced to look for new tankers to replace those hit by sanctions.
Freight rates still remain above levels in January, when the cost of shipping Russian crude from the Baltic ports to India was $4.7-4.9 million.
Source: Reuters
