Asia gains price edge as EU pledges to distance itself from Russian oil

摘要

The EU’s move to distance itself from Russian crude may give Asia an edge in negotiating bigger discounts for spot cargoes and an opportunity to seal long-term contracts with the emergence of new buyers in the region. The latest pledge by the EU this week to ban Russian oil imports by sea, which amounts to more than two-thirds of Russian crude deliveries to the bloc, will sharply narrow the sale window for Russia. “The US has already banned imports of Russian crudes, and with the European Union in the process of doing so, that has left Asia as the only major outlet for those crudes,” said Lim Jit Yang, adviser for oil markets at Platts Analytics. “As a result, Asian buyers should have the upper hand in terms of pricing.” According to Platts Analytics, Asia is expected to account for about 40% of global incremental crude runs in 2022, with the US and Europe accounting for about 30% and 18%, respectively.