Export price of Russian oil was negative

the Export price of Russian oil was negative the Export price of Russian oil was negative
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the Price formula of Russian oil that serve as the main benchmark for pricing in the domestic market, started to match negative values, said Agency Argus Media. Quote Argus fip (Free in pipeline – delivered to the pipeline at the seller’s expense) Western Siberia on Monday was equal to minus 1007 rubles per ton, and on Tuesday – minus 1200 rubles per ton, indicates the Agency.

Negative quotes signify that the costs of transportation, payment of export duties and some other charges on these two days exceeded the average price of Russian oil Urals. “This situation has caught many market participants, as their prices on oil supply contracts both annual and short-term based on the value of the formula within one month of delivery”, – said the Agency.

At the end of March the average value of the fip quotes Argus of Western Siberia has remained positive, but fell by about 12 500 rubles per ton relative to the February level, emphasizes Argus Media. According to the Agency, the oil suppliers worry that the prolonged period of low prices will contribute to zero or even negative profitability of its sales in Russia.

In mid-March, the price of Urals oil for delivery in Europe for the markets of North-Western Europe fell below $ 19 per barrel, and by the end of the month dropped to about $ 16 – the lowest since 1999, writes Forbes.

the Glut in the oil market is due not only to the pandemic of coronavirus, from combat toOh stops production and falling consumption, but also the beginning of the economic “war of attrition” between Saudi Arabia and Russia. It provoked a demonstrative RF output of the transaction OPEC+ 9 March meant Moscow’s desire to increase oil production. In the context of the pandemic and the beginning of the economic crisis the experts evaluated this step as a suicide.

After the demarche of the Russian Federation similar decisions about increasing oil production began to take other exporters. This led to an even more dramatic drop in the price of oil, which Moscow more and more difficult to sell for other reasons. So, China started to refuse from hydrocarbons of Rosneft due to US sanctions against Russia.

Experts believe that even the first effects of the “oil war” for Russia are disastrous. However, in the Kremlin deny it.

in Less than two weeks, a barrel of Brent fell in price by more than 40% since the beginning of the year three times (8 January crude oil was trading around 72 dollars per barrel).

Russian Urals after the breakup of OPEC agreements+ in less than a month fell from 50 up to $ 13 per barrel by March 30. This is the minimum level of prices for Russian oil since 1999. In these conditions in Russia and decided to at least stop to increase production.

According to analysts, by the summer of to store the oil will be nowhere. Of the three largest world oil producers Russia has the least amount of available storage is approximately eight days. These figures are based on the volume of production that can be saved if the export runs out. Saudi Arabia has in reserve for 18 days, and in the US for 30 days. Now oil give free and sometimes even pay extra to consumers.

March 30, the state of the oil market after a sharp fall in world oil prices discussed by telephone the presidents of Russia and USA Vladimir Putin and Donald trump. The us leader ahead of the meeting with Putin said in an interview that Saudi Arabia and Russia are “crazy” and he intends to raise the subject in conversation with the Russian President.