The average selling price of Russia’s key Urals crude fell to $62.99 a barrel last year from $76.09 a barrel the previous year. It was slightly above the $60 per barrel price ceiling imposed on Russian oil by Western countries.
The fluctuating drop in price
The ministry also said the average price of Urals crude rose to $64.23 a barrel in December from $50.47 a barrel a year earlier. Earlier this year, however, the price of Urals crude oil had fallen below the price ceiling to a range of around $55 to $56 a barrel, according to Reuters data. The G7, Australia and the European Union have imposed a cap of $60 per barrel on Russian crude transported by sea from December 2022. If this limit is exceeded, the oil is banned from being transported and insured.
The Western countries’ agreement on a price cap on Russian oil is aimed at limiting Moscow’s revenue to finance the war in Ukraine, but also at preventing a significant shortfall in the supply of Russian oil to the world market, which would harm Western countries.
A setback for Russia
Immediately after the price cap was imposed, Russia was forced to cut its oil exports because it had difficulty securing enough ships to transport it. Later, however, it managed to cover most of its transport needs with carriers that do not require Western insurance. However, traders warn that costs for Russian oil exporters have increased many times over as a result of Western sanctions, Reuters reports.
Russian Deputy Prime Minister Alexander Novak said in late December that almost all of Russia’s oil exports last year went to China and India. Europe’s share of Russian oil exports has fallen to around four to five percent, he said, from around 40 to 45 percent in the run-up to the war in Ukraine.
Source Czech Press Office
