Urals crude oil prices hit a low of $36.6 per barrel last week, the lowest since early 2023, due to the impact of U.S. sanctions on Russian energy giants. The price drop caused discounts relative to Brent to widen significantly, approaching record levels. This decline is largely due to major buyers in India and China halting purchases from sanctioned companies like Rosneft and Lukoil. Consequently, Russia’s seaborne exports have dropped, and an increasing number of oil cargoes are being stored on tankers.
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In a summit held in London, over 20 nations supporting Ukraine have committed to removing Russian oil and gas from the global market to pressure President Putin. Key actions include sanctions against major Russian oil companies and targeting Moscow’s LNG exports, with the UK aiming to unlock billions through Russian sovereign assets for Ukraine’s defense. While the allies also pledged to bolster Ukraine’s air defenses, no announcements were made regarding the delivery of long-range missiles, which Ukraine has requested to target Russian military assets. Despite these efforts, no specific strategies were detailed to force a battlefield change or compel Putin to negotiate.
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China state oil majors suspend Russian oil buys due to sanctions is a headline that certainly grabs your attention, and for good reason. It signals a significant shift in the global energy landscape, and it’s something we need to unpack. The core of the matter is that major Chinese state-owned oil companies, the heavy hitters in the industry, have temporarily hit the pause button on buying seaborne Russian oil. This decision, as confirmed by trade sources, comes directly in response to the latest round of U.S. sanctions targeting key Russian oil players like Rosneft and Lukoil.
The implications of this move are quite far-reaching, especially when you consider that China is a massive consumer of Russian oil.… Continue reading
John Q. Hosedrinker 
Matt Underwood