Oil Exports from Russia by Sea Drop to Minimum Since Early 2025
In the context of adapting to US sanctions against LUKOIL and Rosneft, maritime oil exports from Russia fell to 291,000 tons per day in mid-November, marking the lowest level since the beginning of 2025. At the same time, freight rates for transporting crude oil from Russia continue to rise and have reached annual peaks in some directions.
Oil exports from Russia by sea decreased by 12.7% to 291,000 tons per day from November 10 to 16, according to the Price Index Center (PIC) review. This is the lowest figure for the current year.
The main decline occurred at the Primorsk port, where loading fell by 73.2% over the week to 43,000 tons per day. In total, three Aframax tankers with a deadweight of 100,000 tons set sail from Primorsk: one heading to Turkey, another to Egypt, and the third to an undisclosed destination. Additionally, no shipments of Russian oil were recorded from the Novorossiysk port from November 14 to 17 due to an incident.
The decline in export volumes, as noted by the PIC, is a result of restructuring trade processes among certain companies. Analysts previously indicated that such a necessity could arise due to US sanctions against LUKOIL and Rosneft. According to S&P Global Commodities at Sea (CAS), China and India, the two largest buyers of Russian oil, have increased imports of crude from the Middle East and the Atlantic basin in recent weeks in light of intensified sanctions against Russia.
The increase in risk premiums and the global rise in demand for Suezmax tankers with a deadweight of 135,000 tons have raised freight rates for transporting Russian oil from Novorossiysk to Western India by 1.2% over the week, reaching $8.6 per barrel, as reported by the PIC. Transportation of oil from ports in the Azov-Black Sea basin to Turkey has increased by 2.8% to $5.1 per barrel, while rates to Western India rose by 3.2% to $8.8 per barrel, according to the PIC. The global Suezmax index stood at $63,130 per day as of November 17, which is 1.7 times higher than at the beginning of October, according to S&P Global.
Market participants noted by the PIC report a decrease in the available free tonnage from Greek shipowners. Greece has long been, in essence, the only jurisdiction in the EU owning vessels that transport Russian oil, says Open Oil Market CEO Sergey Tereshkin. Another exception was Malta, but the volumes shipped by Greek tankers were significantly higher, he adds.
Some US sanctions imposed at the end of October will take effect on November 21, causing shipowners to continue raising risk premiums for transporting Russian oil. The PIC explains that potential issues at unloading ports due to missed delivery deadlines could lead to significant financial losses. However, analysts note that the decisive factor for rising freight rates will be the global trend of increasing maritime logistics costs, driven by seasonal demand.
Igor Yushkov, an expert at the Financial University under the Government of Russia, believes that the cost of transporting Russian oil has reached its peak. But the PIC forecasts that by the end of the year, the record for freight rates on Suezmax may be updated. The process of replacing some of the oil subject to sanctions will create additional demand for tankers, quotes Giovanni Gavarone from Maersk Tankers, CAS reports.
Until the end of 2025, volumes of maritime oil supplies from Russia will also depend on how importing countries perceive the risks associated with sanctions, according to Sergey Tereshkin. He states that the recent decision by the US Treasury's Office of Foreign Assets Control to extend the deadline for LUKOIL to wind down foreign operations is a good sign that buyers may interpret as a sign of easing relevant risks. Meanwhile, the PIC believes that the rise in freight rates for Russian oil will attract global carriers, including Greek, Chinese, and UAE shipowners.
Deputy Prime Minister Alexander Novak stated on November 19 that US sanctions against Rosneft and LUKOIL have not affected oil production in Russia. In November, oil production in the country is growing slightly faster than in October, and the annual production forecast remains at 510 million tons. The discount on Russian crude will gradually decrease as the market adapts, says Alexander Novak.
Source: Kommersant
