Russia’s crude oil exports from its three main western ports are set to decline by 13% in November, totaling approximately 1.95 million barrels per day (about 8 million metric tons). This reduction follows the conclusion of the refinery maintenance season. Key points include:
Export Volume Drop: The expected drop in exports from Primorsk, Ust-Luga, and Novorossiisk comes after a monthly export level of 2.25 million barrels per day in October.
Refinery Maintenance Impact: With the end of seasonal maintenance, Russian refineries are anticipated to increase operations. However, the offline refining capacity will only be 1.8 million tons in November, down from 4.4 million tons in October, which typically leads to less crude oil available for export.
Profitability Concerns: Some Russian refineries may choose to maintain lower processing levels due to weak profit margins on oil products, despite the end of maintenance. Traders note that export profitability remains low due to discounts for Russian fuel and high shipping costs.
OPEC+ Compliance: Russia has been exporting high volumes of oil this year, even exceeding its OPEC+ production limits. The country has acknowledged overproduction and plans additional cuts starting at the end of 2024.
Market Implications: The decline in exports and the uncertainty surrounding refinery operations could influence global oil prices, as market participants closely monitor these shifts.