The US Is Concerned About Dwindling Access to Russian Oil
The US is concerned that reduced access to Russian oil beginning December 5 may lead to increased prices, according to US Deputy Treasury Secretary Wally Adeyemo, who spoke to media in New Delhi on Friday.
Adeyemo stated that he had a very fruitful discussion with Indian officials and business sector actors regarding the idea of a Russian crude price ceiling.
Adeyemo traveled to Mumbai to meet with private sector representatives and Reserve Bank of India officials before arriving in India’s capital.
Chinese Defense Firm Takes Over Lifting Venezuelan Oil
According to three individuals and tanker tracking data, As part of an arrangement to balance Caracas’ billions of dollars in debt to Beijing, China has entrusted a defense-focused state business with delivering millions of barrels of Venezuelan oil over US sanctions.
After Washington reinforced sanctions on Venezuela, China National Petroleum Corp (CNPC) stopped transporting Venezuelan oil in August 2019. However, it found its way to China via traders who repackaged the petrol as Malaysian.
According to the loading schedules of Venezuelan national oil business PDVSA and tanker tracking data from Refinitiv and Vortexa Analytics, the firm has taken 13 cargoes carrying nearly 25M barrels of oil, including two vessels scheduled to arrive in China in September.
According to one of the sources, the 13 cargoes, valued at approximately $1.4B at formula prices for Venezuela’s flagship-grade Merey crude, were designated “crude oil” at Chinese customs without disclosing their origin.
Since October 2019, China has not officially recorded oil imports from Venezuela.
Venezuela’s debt stretches back to 2007, when then-President Hugo Chavez borrowed more than $51B from Beijing in loan-for-oil transactions.
China, the world’s largest oil customer, has profited from cheaper oil supplies from Iran and Venezuela recently and has recently increased imports from Russia amid strained relations with Washington.
According to one independent refiner, the oil was provided at $7,9 per barrel less than benchmark Brent crude ex-storage, compared to a discount of more than $30 for similar-quality petroleum advertised as a Malaysian export.
Oil Prices Rise as Traders Await News About the Iran Deal
Oil prices rose slightly on Friday as investors awaited further information about a prospective nuclear deal with Iran and the possibility of Saudi Arabia cutting production. Prices have climbed this week as hopes for a nuclear deal with Iran have been countered by statements from Saudi Arabia about prospective production restrictions.
Saudi Arabia’s energy minister’s comments suggest that international oil benchmarks will not be able to go below $90 per barrel without at least some verbal involvement from the Organization of Petroleum Exporting Countries and its partners.
These contracts are on track for weekly gains of more than 4%, aided by Saudi Energy Minister Prince Abdulaziz bin Salman’s earlier this week hint that the Organization of Petroleum Exporting Countries may cut output as futures prices. Those that have fallen more than 25% from their summer highs fail to reflect the tightness of the physical market.
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