Alexey Gromov, Principal Director on Energy Studies of the Institute for Energy and Finance, commented on the possible reasons for the sharp decline in prices for Russian oil on the world market to the Infotech Internet portal.
Alexey Gromov, noted that the expansion of the price spread is explained by the increase in freight and insurance costs, since a number of shipowners refused to transport Russian oil cargoes even with Eastern oil, which goes beyond the price ceiling.
According to him, price discounts for Russian ESPO grade oil have also increased to $6.5 per barrel, but they still remain above the price ceiling of $60 per barrel. Because of this, at least two major shipowners, China Cosco Shipping Corp. and the Greek Avin International Ltd., refused to transport Russian oil ESPO.
According to him, in the future the discount will be reduced, but not much. A lot will depend on the situation with world prices, as buyers are already accustomed to a discount on Russian oil of $ 20 per barrel, and are unlikely to agree to other conditions."I'm afraid this problem will last for several months. Yes, we have managed to re-register everything on the open market to the Russian jurisdiction: tankers, we have agreed on a shadow fleet, but these efforts are not enough. However, in the coming months, in winter, Russian companies should more or less solve this problem. I take about 3 months to solve logistical problems," the expert said.
The situation is aggravated by the fact that the cargo delivery route has been extended by 2 times from the western ports of Russia.
"The cost of freight increases at least 2 times and all this is ultimately reflected in the final cost. In the future, we are unlikely to significantly reduce insurance and freight costs," Gromov added.
Subscribe for updates
and be the first to know about new publications