Tanker freight assessments for Russian crude export launched

Global energy and commodity price reporting agency Argus has launched tanker freight assessments for Russian crude exported from the Black Sea, Baltic and Barents Sea regions. The new rates show the costs of delivering Russian crude to India and China and highlight the “sanctions premium” for this trade.
The EU’s ban on seaborne imports of Russian crude and the accompanying G7-led $60/bl price cap on sales of Russian crude have gradually pushed much of the business of shipping grades such as Urals to an unorthodox fleet, which has created significant ambiguity about transportation costs.
New trade flows for Russian crude have developed to supply buyers in India and China. But the real freight costs involved have not been visible to the general market, with commentators often referring to the “shadow” or “dark” fleet that facilitates this trade. This is despite a sizable volume of Russian crude moving on legitimate vessels, operating within the G7 price-cap restrictions.
Argus’ new assessments bring transparency to this opaque trade with the publication of two types of Russian-origin freight rates. The first are weekly market survey assessments, underpinned by market indications, transactions, bids and offers. These represent the actual market level, reflecting tanker rates for both legitimate and “shadow” fleets.
The second type are daily baseline rates for comparison purposes. These indicate notional freight costs – what costs would be if Russian cargoes were operating in the general open market without being subject to sanctions.
Argus Media chairman and chief executive Adrian Binks said: “Our new Russian origin crude freight assessments help provide market participants with important information to understand both the cost of shipping as well as the sanctions premium freight spread. This new transparency will aid understanding of the pricing and competitiveness of Russian crude in the international market against competing grades. These assessments are an essential piece of the puzzle for any companies involved in the seaborne crude market.”

Marex Media