Russia Sees Natural Gas Revenues Collapse - OilPrice.com

Russia Sees Natural Gas Revenues Collapse | OilPrice.com

1. Defying Weakness in WTI and Brent, Dubai Soars to Prominence

- The Brent/Dubai exchange of futures for swaps spread, a key indicator of arbitrage from Europe to Asia, narrowed to a 2-year low recently and slightly even dipped below zero this week.

- A strong Middle Eastern benchmark is largely coming from Saudi Arabia’s 1 million b/d production cut pledge as well as higher availability of US crude in Europe pushing down the NW European market.

- Chinese refiners have resumed purchases of North Sea crudes as several VLCCs have loaded in past weeks, with a whopping 54 million barrels of West African oil having been fixed to Asia in June.

- At the same time, China’s state-owned companies have traded over 1300 Dubai partials in the Platts Dubai/Oman window, the second highest on record, with Unipec rising to become a primary seller and PetroChina heading the list of buyers.

2. Russian Government Sees Gas Revenue Collapse on Lower Exports

- Having pumped some 150 billion cubic meters of pipeline gas to Europe, Russia’s invasion of Ukraine has sealed off most of the European markets from Gazprom, painfully denting government revenue.

- Whilst oil revenues continue to flow in relatively unchanged despite the price caps, Russia’s gas revenues plunged 45% year-on-year and amounted to only 8.3 billion in the first five months of this year.

- Despite the hurried infrastructure build-out towards China,…