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Treasury: Russia Oil Sanctions Are Cutting Revenues as Buyers Pause Before Nov. 21

Multi-year lows for Urals signal reduced demand ahead of potential disruptions to Russian flows.

Overview

  • OFAC’s initial analysis of the Oct. 22 measures finds Russian oil prices have dropped, curbing Moscow’s revenues and pointing to lower sales volumes over time.
  • Nearly a dozen large Chinese and Indian refiners have indicated they will suspend purchases for December loadings, according to the Treasury’s assessment.
  • LSEG data show Urals loaded at Novorossiysk traded at $45.35 per barrel on Nov. 12, the lowest since March 2023, reflecting deeper discounts to benchmarks.
  • Global benchmarks eased as traders reassessed supply risks after oil loading resumed at Novorossiysk and as U.S. inventory data signaled a supply build.
  • Uncertainty over enforcement and the risk of Russian use of a shadow tanker fleet persist, with a Nov. 21 cutoff set for companies to cease cooperation with Rosneft and Lukoil.