In February of this year, the average price of the Urals brand fell by 20% compared with the same month of 2019. According to the Ministry of Finance, last month the cost of the Russian standard was 54.24 dollars per barrel.
If we take the average estimate for the first two months, it amounted to 58 , 13 dollars per barrel, and in January-February 2019, the price of Urals was 61.76 dollars per barrel. The average price of Urals oil for the entire last year amounted to 63.59 dollars per barrel. This is 9.17% less than a year earlier.
In general, Urals, which was the most expensive oil in the world last fall, is now sold at a serious discount to the Brent brand. This is not about stock quotes of futures, but about real physical oil. So, if at the end of the year a Urals barrel was sold at a price of 25-40 cents more than a barrel of the North Sea standard, now the discount for the Russian brand in relation to Brent is about $ 3.5.
Thus, the recent rise in oil prices on the exchange has been observed recently , did not significantly affect the cost of physical supplies. And this applies not only to the Russian standard. A similar situation exists with the Arab Light variety supplied by Saudi Arabia.
Saudi Aramco lowered the price of February deliveries to Europe by $ 3.3 for southern European countries. And for Germany, Britain, Scandinavia and the Netherlands, the discount was $ 4.05.
Why Urals fell in price
However, the cheapening of Saudi oil is the main reason for the continued oversupply on the market. For the first quarter, the International Energy Agency estimates it at 700 thousand barrels per day.
And the Russian standard, in addition, was under pressure from the new requirements of the International Maritime Organization of the United Nations (IMO) on the sulfur content of marine diesel fuel. Since January 1, the maximum permissible sulfur in such fuel has been reduced from 3.5% to 0.5%.
Now high-sulfur Russian oil requires better refining, which means that the demand for it is reduced. As a result of the discount for Urals may increase to $ 5 per barrel, according to Argus Consulting. .
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