Russia's flagship oil moves closer to $60/barrel cap threshold

The price of Russian oil is nearing a threshold that could create complications for the country’s biggest buyers.  

The Group of Seven nations last year imposed a cap of $60 a barrel on crude shipped from Russia to limit the Kremlin’s profits amid the war in Ukraine. 

Buyers who pay above that level lose access to industry-standard insurance under the sanctions. The price of Russia’s flagship Urals crude at the point of export is getting closer to the $60 limit, data from Argus Media shows. 

The delivered price of the grade to India’s west coast — including shipping costs — was actually more than $73 a barrel as of April 6. It’s getting increasingly difficult to assess the actual price of Russian crude, due to the emergence of a shadow fleet of vessels and trading companies with unclear affiliations. 

 

However, oil prices soared following last week’s shock announcement by Opec+ to cut output, and global demand is expected to increase later this year, adding further upward pressure.