Russian Oil Price in India Hits Record Amid Surging Demand for Urals Supplies

Global Oil Prices Spike as US Widens Permit for Russian Crude Exports

Urals crude delivered to India's west coast reached a record high of $98.93 a barrel on Friday, according to data from Argus Media. This price, which includes shipping costs, is the highest since Russia redirected crude exports to India following its invasion of Ukraine in early 2022.

The spike in prices follows higher global oil prices amid the ongoing war in the Middle East. The discount on Russia's crude shipped to Indian ports narrowed to $4.80 a barrel versus the global benchmark Dated Brent on Friday, the lowest in more than four months, the data showed. This move is attributed to the US Treasury's second authorization allowing buyers to take Russian oil cargoes already at sea.

The US Treasury's decision, issued in early March, expanded a temporary waiver granted to India alone the previous week to any country. This has led to Indian refiners, including Indian Oil Corp. and Reliance Industries Ltd., purchasing about 30 million barrels of unsold seaborne Russian crude.

Read also: Treasury Yields Experience Largest Increase in Two Weeks Following Release of Labor Market Data

Meanwhile, Urals averaged $73.73 a barrel at Russia's western ports on Friday, the highest since mid-July 2024. The so-called delivery spread, the gap between export and delivered prices, is unclear, and it remains to be seen whether the increased price ultimately accrues to Russia.

The current price is significantly above the $59-a-barrel average assumed in Russia's budget for this year. In response, President Vladimir Putin urged the nation's oil and gas producers to take advantage of soaring commodity prices, but warned that the surge is "certainly temporary" and that officials and companies should plan accordingly.