Just two months ago, Russian Urals crude was commanding a premium of $7 to $8 per barrel over dated Brent for cargoes headed to Asia. Now, for July and August deliveries to Indian and Chinese ports, that same oil is selling at a $2 to $3 per barrel discount. That’s roughly a $10 per barrel swing in the span of weeks.
The culprit is straightforward: Chinese refineries are buying less. And when your two biggest customers are India and China, a pullback from one of them doesn’t just ripple through your order book. It rewrites the pricing entirely.
How Urals pricing got here
Since Western sanctions landed on Russia in 2022, the flow of seaborne Urals crude has undergone a geographic overhaul. European buyers, once the primary market for Russia’s flagship blend, largely stepped away. India and China filled the gap, becoming the dominant purchasers of Russian oil.
That concentration of demand into two countries created a pricing dynamic that cuts both ways. When both nations are buying aggressively, Russian crude can actually trade at a premium to international benchmarks. That’s exactly what happened in April and May of this year, when Urals commanded $7 to $8 per barrel above dated Brent.
