Russia exported extra oil in April than in any month since its full-scale invasion of Ukraine final yr, with virtually 80 per cent of crude shipments flowing to China and India, in accordance with the Worldwide Vitality Company.
Russian oil exports edged up one other 50,000 barrels a day in April to a post-invasion excessive of 8.3mn b/d, far exceeding the 7.7mn b/d and seven.5mn b/d that it averaged in 2022 and 2021 respectively.
The rise in shipments displays Moscow’s success to find each new patrons for its oil since Europe blocked imports and new vessels after its entry to western delivery was restricted.
Because the west first threatened Russia with sanctions final yr, Moscow has labored with a rising variety of little-known buying and selling firms and tanker-owners to develop new methods to maneuver its oil.
“Russia appears to have few issues discovering prepared patrons for its crude and oil merchandise,” the IEA mentioned in a month-to-month oil report on Tuesday.
The EU is discussing its eleventh sanctions package deal on Russia since its invasion of Ukraine final yr. The bloc has sanctioned 1,473 Russian people and 207 entities and frozen €21.5bn of Russian property.
Nevertheless, these measures have been designed to permit Russian oil to proceed flowing to international locations outdoors the EU. The outcome has been one of many greatest shifts in commodity flows, with Moscow rerouting hundreds of thousands of barrels a day of oil from Europe to Asia over the previous 12 months.
Regardless of delivery extra oil than in April 2022, Russia’s month-to-month oil export revenues have been 27 per cent decrease than final yr, in accordance with IEA estimates, partly due to decrease world vitality costs.
Russian oil has additionally been buying and selling at a reduction to world benchmarks due to a G7-led value cap on permitted Russian exports of oil and refined petroleum merchandise imposed in December and February respectively.
Nevertheless, that low cost has begun to slender, the IEA mentioned, as Russia has elevated its entry to non-western delivery capable of function outdoors of the worth caps. Moscow’s oil export revenues in April have been $15bn, up from $13.3bn in March, in accordance with the IEA’s estimates.
In whole Russia shipped 5.2mn b/d of crude in April, probably the most since Might 2022, together with 2.1mn b/d to China and 2mn b/d to India. Complete exports of refined petroleum merchandise have been 3mn b/d.
“New refining capability is driving a continued shift east in forecast crude runs for the rest of the yr, mirroring regional demand power,” the IEA mentioned.
Imports from Russia had helped meet rising oil demand in China, which hit an all-time excessive of 16mn b/d in March, the IEA added. “China’s demand restoration continues to surpass expectations,” it mentioned.
In response, the IEA elevated its forecast for 2023 world oil demand development to 2.2mn b/d, including that China would account for almost 60 per cent of the rise.
The autumn in world oil costs in April and early Might, when Brent crude, the worldwide benchmark, fell by almost $16 a barrel in simply two weeks, stood in “stark distinction” to the tighter market anticipated within the second half of the yr, it mentioned.