Argus: Price formulas for oil in Russia become negative

MOSCOW, Apr 1 (PRIME) -- Contraction of global oil prices has pushed the domestic Russian market prices negative in the last few days of March, research agency Argus said in a statement on Wednesday.

“An unprecedented contraction of global oil prices created a paradox on the Russian oil market at the end of March, as the pricing formulas became negative,” the agency said.

The Urals FIP West Siberia FORMULA price stood at minus 1,007 rubles per tonne on Monday and at minus 1,200 rubles per tonne on Tuesday, meaning that transportation costs, the export duty, and other costs exceeded the average price of the Urals blend in Northwestern Europe and the Mediterranean in the two days.

The average price of the formula in March remained positive, contracting by 12,500 rubles per tonne as compared with February. “Suppliers are concerned that a long period of low prices would result in zero or even negative yields on oil sales in Russia,” Argus said.

(77.7325 rubles – U.S. $1)

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