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Export price of Russian oil drops amid market's downfall

Source : 112 Ukraine

Exports will be disadvantageous if the current situation remains the same within a month
15:45, 2 April 2020

Reuters

The fall in world oil prices has caused a drop in Russian market prices in late March. It was reported by the Russian edition of Argus.

Thus, transportation costs, export duties and other costs exceeded the average value of the Russian Urals export mix in North-Western Europe and the Mediterranean region.

On March 30, the quotation of "Urals FIP Western Siberia Formula" was equal to -12,8 dollars per tonne, and on March 31, - decreased to -15,4 dollars per tonne. Delivery under FIP (Free In Pipe, - 112 International.) stipulates that the seller will deliver the raw materials to the pipeline at his own expense.

Related: Trump call to Putin raises Russia’s hopes of end to costly oil war

This situation has caught many market participants by surprise, as their contracted oil prices, both annual and short-term, are based on the formula's value during the month of delivery.

According to analysts, exports will become disadvantageous if the current situation remains the same within a month.

As we reported earlier, Stockholm Arbitration Tribunal issued a decision in favor of Polish gas company PGNiG ending the 5-year dispute about the price for gas with Russian Gazprom.

The Russian company is obliged to return about 1.5 billion dollars to PGNiG.

Related: Saudi Arabia seeking new markets for its cheap oil

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