Crude oil exports from western Russian ports may decrease by up to 200,000 barrels per day in November. This reduction is due to increased diesel production at refineries under a new agreement between Moscow and Washington.
Impact of the New Agreement on Exports
According to initial loading plans, two traders predict that exports from Russian Baltic and Black Sea ports may decrease by 100,000 to 200,000 barrels per day from October. These estimates include Kazakh crude oil transported through Russian pipelines.
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Russian refineries have ramped up production following the diesel agreement on October 9 between Donald Trump and Vladimir Putin, with this increase facilitated by the return of facilities from maintenance. Moscow has also issued new diesel export quotas after restricting exports earlier this year to address domestic fuel shortages.
Decline in Crude Oil Production and Export Challenges
Russian oil production is consistently declining. OPEC's secondary estimates indicate that oil production in September reached 8.64 million barrels per day, the lowest level since mid-2020 and the tenth consecutive monthly decline. Moscow has also lowered its production forecast for 2026 to the lowest level in 17 years.
Russian seaborne crude oil exports have also faced challenges in October. The average exports in the four weeks ending October 18 reached 3.59 million barrels per day, a decrease of 110,000 barrels per day compared to the previous period. Weekly exports fell to 3.13 million barrels per day, the lowest level since March.
In the port of Novorossiysk, crude oil loading is facing delays of nearly three weeks, and transportation threats in the Black Sea are impacting exports. Additionally, Ukraine's attacks on Russian refineries could disrupt plans to increase diesel production in November.
The reduction of the Northern Route will also affect the flow of Urals crude oil, as Arctic navigation will soon come to an end for the season. Russia's ability to increase diesel exports depends on the availability of refineries and sufficient crude oil supply, both of which have been limited after months of Ukrainian attacks and declining domestic production.
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