Summary

• In November 2023 Russian seaborne oil exports volumes decreased by ~4% driven by 8% crude exports decline (MoM). The total Russian oil export revenues declined by $3.2 bn to $15.2 bn.

• In November 2023 Russian reliance on Western maritime services barely changed over previous month as 26% of crude and 57% of oil produces were shipped with P&I Club insurance coverage

• KSE Institute estimates 179 loaded Russian shadow fleet tankers left Russian ports in November 2023, 70% of which were built more than 15 years ago. Russian shadow fleet poses huge environmental risks for the EU as decrepit tankers without P&I insurance navigate several European countries coastlines including Danish Straits. In October 2023, the shadow fleet was responsible for exports of around 2.3 mb/d of crude oil and 0.8 mb/d of oil products.

• India remains the biggest buyer of Russian seaborne crude despite a decrease of imports by 22% or by 384 kb/d (MoM). On the contrary, Turkey increased its imports of Russian crude by 34% or by 110 kb/d MoM and total imports increased 2.7 times to 433 kb/d over three months. 71% of crude was shipped to Turkey without P&I insurance in November compared to 0% in February-May 2023. Turkey also remains the biggest buyer of Russian oil products imports with total imports of 437 kb/d in November.

• Significant price discounts for both Russian crude and oil products continue to support the strong demand for Russian oil exports. Average Urals FOB Baltic and Black Sea decreased by over 10/bbl to $67/bbl and $69/bbl respectively, but ESPO FOB decreased by only $6/bbl to $78/bbl. However, the discount on Urals has widened by $2/bbl (MoM) after OFAC imposed its first blocking sanctions and owners for using US-based services while carrying Russian crude sold above the price cap and the US Treasury sent letters to shipping companies for potentially breaching G7/EU price cap in November. On the contrary, the discount on ESPO narrowed by almost $2/bbl (MoM).

• In November 2023 Russian oil export revenues declined by $3.2 bn to $15.2 bn. KSE Institute now projects Russian oil revenues of $182 billion in 2023, while in July they had been expected to reach only $153 billion. According to the KSE Institute modelling, in the base case with current oil price caps and status quo of sanctions but their stronger enforcement, revenues will contract to $145 bn and $139 bn in 2024 and 2025 respectively compared to $218 bn and projected $182 bn in 2022 and 2023 respectively. If the price cap is lowered to US$ 50/bbl discount to forecast Brent prices, revenues will fall to $69 bn and $59 bn in 2024 and 2025 respectively. However, in case of weak sanctions enforcement, Russian oil revenues could increase to the robust $189 bn and $183 bn in 2024 and 2025 respectively.