India tops Russian Urals oil purchases in June as China retreats
(Reuters) - India bought 60% of all Russian Urals oil exports in June with strong demand from all refiners, while shipments to China dropped to just 7% as independent refiners slowed buying, trading sources and Refinitiv Eikon data showed.
Urals is Russia's main export grade from its European ports and represents about a half of total Russian oil exports. The country, subject to severe Western sanctions over its actions in Ukraine, also exports oil from its Pacific ports, its Arctic ports and via a direct pipeline to China.
Russia has heavily relied on India, China, Turkey and Bulgaria for oil sales since the imposition of sanctions.
Any change in appetite for crude in those countries has an immediate impact on Russian exports, revenues and budget, which has been strained by military spending.
Russian oil production cuts and higher refinery runs hit supplies of Urals to the Chinese and Turkish markets in June, while India retained its top share in purchases, Reuters calculations based on two trading sources and Refinitiv Eikon data showed on Tuesday.
In June, oil shipments from the Russian ports of Primorsk, Ust-Luga and Novorossiisk fell to 9.4 million tons (2.3 million barrels per day) from 10.32 million tons (2.42 million bpd) in May, when loadings from the state's western ports were at their highest since 2019.
On Monday, Russia pledged to make an additional 500,000 barrel per day output and export cuts in August.
Urals oil shipments to India in June stood at about 60% of total Urals shipments, in line with May, according to Reuters calculations based on Refinitiv data and sources. Overall India's imports of Russian oil in May reached a new all-time high of 1.95 million barrels per day, accounting for about 40% of the total supply of crude oil to the country, while the share of OPEC suppliers continued to decline.
Demand for Urals in India was supported by attractive pricing for the Russian barrels compared to competing Middle Eastern grades and lower freight rates from Russian ports.
According to Refinitiv data available to date, shipments of Urals oil to China from Russian ports and ship-to-ship (STS) locations fell to just 7% of Urals seaborne exports, down from 13% in May. The fall in June-loading Urals supplies to China was due to weaker demand from Chinese independent refiners that held back from buying due to a shortage of crude import quotas.
Deliveries of Urals oil to Turkey decreased in June to 8% of total Urals seaborne shipments from 11% in May. Turkey though replaced China as the second biggest Urals oil buyer by sea.
Deliveries of Urals oil to Bulgaria, which is allowed to continue seaborne oil imports despite EU embargo on Russian oil, retained its fourth place as the biggest buyer of the cargoes with 6%, up from just 3% in May.
Urals oil supplies to ship-to-ship (STS) facilities rose in June to 19% of all grade's loadings from 11% in May, according to the data, with final destinations for these volumes yet to be determined.
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