Russian oil prices skyrocket, leaving consumers scrambling.

Moscow’s trading partners have increasingly paid more for Russian oil than quoted prices indicate, Goldman Sachs said in a press release, easing Russia from the impact of Western sanctions.
The bank estimated in a February 10 memo that the difference between the average real price paid and the quoted price had widened since last March and was around $25 per barrel in December.
“Our contention that production flexibility has been so far limited may partially reflect the fact that the actual real price paid for Russian oil appears to be significantly higher than the quoted price,” Goldman said. Russia announced on Friday that it will cut oil production by 500,000 barrels per day in March this year.
International Brent crude oil prices rose to an all-time high nearly a year ago following Russia’s occupation of Ukraine, but have since declined. Russia’s reference mix,
Urals are heavily discounted because European buyers have avoided them. Brent is trading around $86 per barrel on Monday.
Russia’s State Duma introduced a bill late Saturday to impose discounts on Russian oil exports, which normally trade at a discount to Brent, according to the website of the lower house of parliament.
Goldman Sachs last week lowered its oil price forecasts for this year and next, but still said it expected prices to gradually rise to $100 a barrel by December.
He said lower Russian production was a “key factor” in that forecast, along with a recovery in Chinese demand following the lifting of COVID-19 restrictions on the world’s largest consumer of goods. “We expect Russian output to fall by 570,000 bpd in March-June.” and the risks now tend towards a more forward-looking March cut (without a significant impact on annual supply and therefore Brent),”  Goldman Sachs said in a note.

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