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Russia's Oil Earnings Hit Lowest Point Since Mid-2023 Amid Falling Exports and Prices, Bloomberg Reports
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According to a Bloomberg report, Russia’s oil earnings have dropped to their lowest levels since mid-2023, with exports declining for the third consecutive week and prices falling amid the US-China trade war.
Crude exports from all Russian ports fell to 3.13 million barrels per day in the four weeks leading up to April 13, their lowest since February, about 320,000 barrels per day below the recent peak. The gross value of these shipments dropped by around $80 million, or 6%, to $1.29 billion per week, the lowest since July 2023. This decline could impact the Kremlin’s funding for its war in Ukraine, as oil taxes play a crucial role in Putin’s war chest, Bloomberg reports.
Russia, a key member of OPEC+ , will not benefit from planned supply hikes until October, with initial increases offset by deeper cuts made to compensate for previous overproduction. Meanwhile, oil prices have dropped to their lowest in four years due to OPEC+'s decision and US President Donald Trump’s announcement of sweeping tariffs.
The decline in shipments is partially due to a reduction in weekly deliveries, with the effects of an early-March export surge tapering off. Moscow’s oil prices have taken a bigger hit, with key export grades falling by more than $9 per barrel following the imposition of trade tariffs.
According to Bloomberg, the drop in prices has allowed Western ships to transport Russian oil, as the $60-per-barrel price cap no longer applies to Urals crude. Despite increased inspections by Baltic states, Western-owned vessels are being used more frequently.
In the week to April 13, 29 tankers carried 21.93 million barrels of Russian crude, a slight decline from the previous week. Crude flows averaged 3.13 million barrels per day.
The value of Moscow’s oil exports dropped by $220 million (16%) to $1.15 billion, reflecting lower volumes and prices. The export value of Urals crude fell by around $9 per barrel, while ESPO crude dropped by $9.70, the report states.
Over the four-week period ending April 13, total export value fell to $1.29 billion per week, down 6%. Shipments to Asian customers, including those with unclear destinations, fell to 2.9 million barrels per day, while shipments to Turkey remained steady at 210,000 barrels per day, Bloomberg wrote.
Previously, it was announced that the European Union is set to unveil a long-delayed strategy to phase out Russian oil and gas imports on May 6, according to Reuters. The release of the plan, which has already been postponed twice, outlines how the bloc intends to end its reliance on Russian fossil fuels by 2027.
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