Russia cuts crude oil exports to a 12-month low

In July, Russia reduced its crude oil exports to their lowest level in a year, while exports of refined products rose by 6% thanks to the recovery of domestic refineries.

Share:

Navire pétrolier dans les eaux russes

Russia’s seaborne crude oil exports fell in July 2024 to their lowest level in 12 months.
According to S&P Global Commodities at Sea data, crude shipments fell by 520,000 barrels per day (b/d) to an average of 3.19 million b/d.
This reduction is attributable to lower shipments of Urals crude from Baltic and Black Sea ports.

Reduction factors

The drop in exports was due to several factors.
On the one hand, demand from Indian refineries fell, with flows to Indian ports reduced by 390,000 b/d in July, due to seasonal maintenance at several refineries.
On the other hand, exports to China fell by 22,000 b/d, reaching their lowest level since December 2022.
In Turkey, the third largest buyer of Russian crude, flows fell by 41% to 274,000 b/d.
The reduction in Russian exports comes as discounts for Urals crude have fallen.
According to Platts assessments, the Urals discount to Dated Brent shrank to $11.95/b on August 1, its lowest level since the start of the Russian-Ukrainian conflict.

Compliance with OPEC+ commitments

Moscow is striving to meet its OPEC+ production reduction commitments.
After overproducing by 480,000 b/d in the first six months of 2024, Russia is now committed to reducing production in line with its targets.
This commitment to compliance with OPEC+ coincides with a decline in seaborne crude oil exports.

Refinery takeover

In parallel with the drop in crude exports, Russia increased its exports of refined products by 6% in July, thanks to the resumption of capacity at refineries damaged by Ukrainian drone attacks.
Seaborne shipments of diesel, fuel oil, naphtha and other refined products reached 2.27 million b/d, up 6.3% on June.
Refinery recovery led to a significant reduction in shutdowns.
Despite several drone attacks in July, targeted refineries remained operational, with attacks now focused on oil depots rather than refining equipment.
Analysts at Commodity Insights are forecasting an increase in diesel and gasoil exports following the return to service of most of the damaged refineries.
Diesel and gasoil exports averaged 792,000 b/d in July, up 4% on June, but still below end-2023 levels.
Naphtha and VGO exports also rose, while gasoline exports fell in anticipation of the Russian government’s reinstatement of the gasoline export ban.
The gasoline export ban, initially suspended to stabilize domestic prices, will be reinstated in August and could last until October.
The Russian authorities are considering this measure to maintain stable prices at the pump.

Petro-Victory Energy announces the completion of drilling operations for the AND-5 well in the Andorinha field, Brazil, with positive reservoir results and next steps for production.
The Colombian prosecutor’s office has seized two offices belonging to the oil company Perenco in Bogotá. The company is accused of financing the United Self-Defense Forces of Colombia (AUC) in exchange for security services between 1997 and 2005.
Indonesia has signed a memorandum of understanding with the United States to increase its energy imports. This deal, involving Pertamina, aims to diversify the country's energy supply sources.
VAALCO Energy continues to operate the Baobab field by renovating its floating platform, despite modest production. This strategy aims to maintain stable profitability at low cost.
An empty reservoir exploded at a Lukoil-Perm oil facility in Russia, causing no injuries according to initial assessments pointing to a chemical reaction with oxygen as the cause of the accident.
The British Lindsey refinery has resumed fuel deliveries after reaching a temporary agreement to continue operations, while the future of this strategic site remains under insolvency proceedings.
BP and Shell intensify their commitments in Libya with new agreements aimed at revitalizing major oil field production, amid persistent instability but rising output in recent months.
The private OCP pipeline has resumed operations in Ecuador following an interruption caused by heavy rains, while the main SOTE pipeline remains shut down, continuing to impact oil exports from the South American country.
McDermott secures contract worth up to $50 million with BRAVA Energia to install subsea equipment on the Papa-Terra and Atlanta oil fields off the Brazilian coast.
Saudi Aramco increases its oil prices for Asia beyond initial expectations, reflecting strategic adjustments related to OPEC+ production and regional geopolitical uncertainties, with potential implications for Asian markets.
A bulk carrier operated by a Greek company sailing under a Liberian flag suffered a coordinated attack involving small arms and explosive drones, prompting an Israeli military response against Yemen's Houthis.
The Canadian government is now awaiting a concrete private-sector proposal to develop a new oil pipeline connecting Alberta to the Pacific coast, following recent legislation intended to expedite energy projects.
Petrobras is exploring various strategies for its Polo Bahia oil hub, including potentially selling it, as current profitability is challenged by oil prices around $65 per barrel.
Brazilian producer Azevedo & Travassos will issue new shares to buy Petro-Victory and its forty-nine concessions, consolidating its onshore presence while taking on net debt of about USD39.5mn.
Major oil producers accelerate their return to the market, raising their August quotas more sharply than initially expected, prompting questions about future market balances.
Lindsey refinery could halt operations within three weeks due to limited crude oil reserves, according to a recent analysis by energy consultancy Wood Mackenzie, highlighting an immediate slowdown in production.
The flow of crude between the Hamada field and the Zawiya refinery has resumed after emergency repairs, illustrating the mounting pressure on Libya’s ageing pipeline network that threatens the stability of domestic supply.
Libreville is intensifying the promotion of deep-water blocks, still seventy-two % unexplored, to offset the two hundred thousand barrels-per-day production drop recorded last year, according to GlobalData.
The African Export-Import Bank extends the Nigerian oil company’s facility, providing room to accelerate drilling and modernisation by 2029 as international lenders scale back hydrocarbon exposure.
Petronas begins a three-well exploratory drilling campaign offshore Suriname, deploying a Noble rig after securing an environmental permit and closely collaborating with state-owned company Staatsolie.