17.08.2023, 22:09
Brazil has increased purchases of Russian fuel on a record
Source: OREANDA-NEWS
OREANDA-NEWS Brazil's purchases of Russian fuel may reach a record in August 2023. Bloomberg writes about this with reference to data from the energy analytical company Kpler.
Imports of Russian petroleum products are expected to grow by 25 percent compared to July and will amount to about 235 thousand barrels per day. This will exceed the projected supplies from the United States, which used to be the largest foreign supplier of fuel to Brazil.
Brazil began to sharply increase purchases from Russia in February 2023, after the entry into force of the EU embargo on the supply of Russian oil by sea and the establishment of marginal prices prohibiting the transportation and insurance of oil purchased in Russia at a cost above $ 60 per barrel. These measures have led to lower prices for Russian fuel, which have become more attractive to compete with other suppliers in new markets.
"Buying barrels at a discount is a financial advantage" for Brazil, explained Victor Katona, a leading oil analyst at Kpler. In this Latin American country, the government is constantly under public pressure to lower retail fuel prices. The price threshold for Russian premium petroleum products, such as diesel fuel, is set at $100 per barrel, and the upper limit for discounted fuel is $45 per barrel. The purchase of Russian diesel helped Brazil to reduce the average price of this imported fuel by 10-15 dollars per barrel, the expert noted.
According to Kpler, since the price cap came into force, Brazil has become the second largest buyer of Russian diesel, second only to Turkey. Since June, Russia has also started to supply gasoline to Brazil, although in much smaller volumes. "Brazil is the largest market in Latin America, so Russian refineries are focused on supplies to this country," the analyst said.
Earlier it was reported that in the first five months of 2023, Russia increased oil supplies to India by 11 times compared to the same period last year and became the largest oil importer for this country. The volume of Russian oil exports in January-May amounted to almost 37 million tons, which turned out to be more than the figure for the whole of last year — 33.4 million tons.
Imports of Russian petroleum products are expected to grow by 25 percent compared to July and will amount to about 235 thousand barrels per day. This will exceed the projected supplies from the United States, which used to be the largest foreign supplier of fuel to Brazil.
Brazil began to sharply increase purchases from Russia in February 2023, after the entry into force of the EU embargo on the supply of Russian oil by sea and the establishment of marginal prices prohibiting the transportation and insurance of oil purchased in Russia at a cost above $ 60 per barrel. These measures have led to lower prices for Russian fuel, which have become more attractive to compete with other suppliers in new markets.
"Buying barrels at a discount is a financial advantage" for Brazil, explained Victor Katona, a leading oil analyst at Kpler. In this Latin American country, the government is constantly under public pressure to lower retail fuel prices. The price threshold for Russian premium petroleum products, such as diesel fuel, is set at $100 per barrel, and the upper limit for discounted fuel is $45 per barrel. The purchase of Russian diesel helped Brazil to reduce the average price of this imported fuel by 10-15 dollars per barrel, the expert noted.
According to Kpler, since the price cap came into force, Brazil has become the second largest buyer of Russian diesel, second only to Turkey. Since June, Russia has also started to supply gasoline to Brazil, although in much smaller volumes. "Brazil is the largest market in Latin America, so Russian refineries are focused on supplies to this country," the analyst said.
Earlier it was reported that in the first five months of 2023, Russia increased oil supplies to India by 11 times compared to the same period last year and became the largest oil importer for this country. The volume of Russian oil exports in January-May amounted to almost 37 million tons, which turned out to be more than the figure for the whole of last year — 33.4 million tons.
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