The price of Russian Urals crude is rising: prices have hit a record high following the U.S. decision
16 March 20:34
Prices for Urals crude oil, a Russian blend supplied to India, have reached a record high after the U.S. allowed countries to temporarily purchase Russian oil already at sea. Bloomberg reported this, citing data from the analytical agency Argus Media, according to [Komersant].
According to their information, the price of Urals crude delivered to India’s west coast reached $98.93 per barrel on Friday—the highest level since Russia redirected supplies to the Indian market following its full-scale invasion of Ukraine.
Why prices have surged
The main reason for the price surge was the rise in global oil prices amid the war in the Middle East.
At the same time, the discount at which Russian oil is traditionally sold relative to the global benchmark Brent crude oil has narrowed.
According to Argus Media:
- the discount on Urals has narrowed to $4.80 per barrel;
- this is the lowest figure in the last four months.
The U.S. decision impacted the market
An additional factor was the temporary license issued by the U.S. Department of the Treasury.
The document allows buyers to:
- purchase Russian oil that is already at sea;
- to conduct such transactions regardless of the buyer’s country.
Previously, such a relaxation of sanctions applied only to India. The new license effectively expanded the temporary exemption from sanctions.
According to the agency, the Donald Trump administration took this step to ease pressure on global oil prices amid the conflict in the Middle East.
Indian companies have stepped up purchases
Following the easing of sanctions, Indian oil refining companies began actively purchasing Russian crude.
Specifically:
- Indian Oil Corporation
- Reliance Industries
purchased approximately 30 million barrels of Russian oil transported by sea.
This has significantly increased demand for Urals crude on the Indian market.
How much does Russian oil cost at ports
According to Argus Media, the average price of Urals at western Russian ports was $73.73 per barrel.
This is the highest figure since mid-July 2024.
At the same time, Russia’s final profit depends on the so-called “delivery spread”—the difference between the export price and the price at the delivery point.
The price exceeds the Russian budget target
The current price is significantly higher than the level set in Russia’s budget.
In the Kremlin’s financial projections for 2026, the average oil price is about $59 per barrel.
Russian dictator Vladimir Putin urged Russian oil and gas companies to take advantage of the price surge, but warned that this spike may be temporary.
