Russia’s flagship crude traded at one of the deepest discounts in years as traders fret about how the crisis over Ukraine will play out.
Trafigura Group and the trading arm of Lukoil PJSC both offered Urals, the nation’s largest export grade, at $6.30 a barrel below the regional Dated Brent benchmark. That’s the deepest discount in at least 11 years, according to data compiled by Bloomberg. Surgutneftgas PJSC earlier sold the same crude for delivery to Europe at $6 a barrel lower than the same marker.
They’re the latest examples of how sharply the relative value of Russian oil delivered into Europe has slumped over the past few weeks. Traders have been warily watching to see what -- if any -- major measures the U.S. and its allies take to disrupt the flow of Russia’s oil exports.
“Russia-U.S. tensions over Ukraine have contributed to the collapse in Urals differentials,” consultant Facts Global Energy wrote in a note. “It seems that after many European refiners went on a Urals buying spree in December/January, those that have a choice are now shying away from Urals.”
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