HomeMediaLatest NewsDo not assume that Urals is about to give way to Arab Light in Asia

Do not assume that Urals is about to give way to Arab Light in Asia

25 January 2024

Belogoryev Alexey M. Research and Development Director, Director of the Center for Energy strategic analysis and forecasting

Alexey Belogoryev, Research and Development Director of the Institute for Energy and Finance, commented to the Oil and Capital magazine on competing oil from Russia and Saudi Arabia in the Asian market.

As Alexey Belogoryev noted, the rise in the price of Russian oil due to the increase in insurance prices for ships passing through the Suez Canal is some exaggeration. These are not the numbers that should throw Russia's oil out of Asia and force it to retreat before its Middle Eastern competitors.

"There are problems with tightening sanctions against ships going to India, there is a tougher bargaining with the South Asian country for a discount of the Sokol grade. But do not assume that Urals is about to give way to Saudi oil in Asia, and ship insurance in the Red Sea is a serious problem.

Firstly, Arab Light, although it decreased in price, did so after a fairly long period of growth. Secondly, it is still traditionally traded at a premium of almost $1.5 to the market price in the Middle East. And Russian oil in India and China, let me remind you, is still trading at a discount. Yes, it is changing, but it still exists, so the black gold from the Russian Federation is not inferior to its Saudi competitor in any way. Of course, companies in Russia earn less than they would like, but there is income (even with increased insurance of ships in the Red Sea), but Middle Eastern countries do not want to take such measures (to provide a discount)," the expert says.


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