MOSCOW, Jul 22 (PRIME) -- The U.S. raised its oil delivery to Europe in July, squeezing out traditional oil blends from the region including Russia’s Urals, Reuters reported on Wednesday quoting traders and ship tracking data from Refinity Eikon.
U.S. oil sales to Europe grew by 600,000 tonnes to 3.1 million tonnes in July compared with June, the first time since the OPEC+ deal came in force in May. While the U.S. is raising exports, Russia complies with the OPEC+ deal, and its oil exports to Europe has been steadily falling since May to the lowest point over the past 20 years.
At the same time, the European refineries suffer from the lack of crude and low margins thanks to high competition for local oil blends. Many plants have to cut loading due to weak economies.
U.S. oil squeezes out local oil blends, but as soon as their prices fall, exporters cut their export plans further and traders have to pay premiums again. But the amount of available oil is shrinking more and more, one Urals trader told Reuters.
The new OPEC+ agreements came in force in May with a reduction of oil production by 9.7 million barrels per day for three months. From August, OPEC+ will continue the reduction, but at a slower pace – by 7.7 million barrels per day until the end of the year and then by 5.8 million barrels per day until the end of April 2022.
The target level of oil production for Russia and Saudi Arabia amounts to 8.492 million barrels per day in May–July and is to increase to 8.993 million barrels per day from August until the end of 2020.
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