Russian crude exports edge down 1% in May amid stable Chinese demand

Russia's seaborne crude exports were broadly stable on the month in May, amid steady deliveries to China and as a plunge in shipments to India was offset by gains in other directions.

The country's exports by sea in May were 4.036 million b/d, down 1% on the month and up 10% on the year, data from S&P Global Commodities at Sea showed June 4.

May exports to China were up 1% on the month at 905,000 b/d, with exports to India down 46% on the month at 1.217 million b/, and to Turkey down 57% on the month at 57,000 b/d, CAS data showed.

Exports to Singapore leapt 279% on the month to 621,000 b/d, CAS data showed.

Platts, part of S&P Global Energy, assessed Urals crude on a FOB basis at Primorsk at an average discount to Dated Brent through May of $21.00/b; it had narrowed from $30.15/b in April. Platts assessed the discount at $24.06/b June 3, against a five-year average of $19.42/b.

Russian ESPO Blend crude loadings from the Kozmino port rose by two ships month over month to what was likely a record-high of 43 ships in May, with India maintaining a relatively high level of imports, compared with prior to the Middle East war, CAS data showed June 2.

Chinese demand is expected to remain sluggish in the near term. Chinese refineries are likely to extend the downtrend in crude throughput in June due to reduced feedstock supply, low oil products demand and high domestic inventories.

Looking ahead, OPEC+ ministers are scheduled to meet June 7 at their first full meeting since war broke out in the Middle East, with oil price volatility and disruptions to supply posing major challenges for the group in the second half of the year.

Export bans

Russian seaborne product exports in May were 1.993 million b/d, down 2% on the month and down 12% on the year, CAS data showed.

Export volumes from the Black Sea region contracted on the month, while exports from Russia's Far East and Baltic Sea region rose, CAS analysts said June 3.

The short-term outlook is one of restrictions; the Russian government introduced a temporary ban on exports of jet fuel, on June 1 to secure domestic supply.

The ban will be enforced through the end of November and applies also to volumes purchased on the exchange floor, it said. The potential enforcement of the ban was reported by Russian media in late May.

Russian Deputy Prime Minister Alexander Novak said June 4 that Russia may impose a ban on diesel exports from Russia, but it is not currently necessary, the Tass news agency reported.

Ukraine's attacks on Russian refineries, which have intensified in the past few months, have significantly limited the facilities' operations.