Page 8 - AsianOil Week 09 2023

AsianOil COMMENTARY AsianOil

port of Kozmino – deliveries that also operate It is the profits earned by the company’s trading
outside the sanctions regime. The price of the arm in the country of the refinery from the sale
ESOP blend is steadily above the $60 threshold of refined products that make the profits, not the
on a FOB basis. cost of the company’s own crude shipped there
In late 2022 the Baltic trade between Pri- as feedstock.
morsk and Rotterdam came to stop and the “Anecdotal evidence from traders suggests
Baltic Exchange no longer has any data to form that Urals sells to other Indian refineries at a
prices, but despite this the exchange is still $6-$10 discount to Brent, dependent largely on
quoting prices based on survey of traders and the prices of Dubai and Oman crudes, which are
producers. the benchmark types in that part of the world,”
Since the European embargo, most Russian says Vakulenko. Indeed, Russia’s Ministry of
crude, loaded in the Baltics and the Black Sea, Finance (MinFin) is talking about abandon-
goes to India, predominantly to west coast refin- ing the Urals price completely when calculat-
eries in the states of Gujarat and Kerala, and ing taxes and using the Dubai prices instead to
India doesn’t share its price information with improve its revenue collection.
the Baltic Exchange. Moreover, since January the More recently, reports show that the discount
number of tankers travelling to “Other Asia” has India was enjoying had fallen to zero in Novem-
soared as the market increasingly goes into dark ber, according to Indian customs data. Russian
mode, but many of these have also ended up in Deputy Foreign Minister Andrei Rudenko said
India, says Vakulenko. on February 16 that India is still paying the full
Coincidentally, one of the largest refineries in market price for oil. Rudenko said that Russian
India, Nayara Energy with 400,000 bpd capac- energy companies are working to fulfil orders
ity, is controlled by Rosneft. As bne IntelliNews as fast as possible and that India has not joined
reported, the economics of Russian oil produc- the price ceiling scheme. Deputy Prime Minis-
ers sending oil to their own foreign refineries is ter Alexander Novak said in February that India
very different to selling oil on the open market, is still not getting a discount to Brent prices.
as the FOB price of exported crude is irrelevant. (chart)

Oil prices, March - November 2022, $ / BBL

P8 www. NEWSBASE .com Week 09 03•March•2023