Russian Oil Prices Rise After Ukrainian Attacks

Russian sunflower oil has lost its main advantage on the global market: its lower price. For the first time in a long while, it is now selling for more than Ukrainian sunflower oil, according to Ekonomicka pravda, citing the Latifundist website.

Last week, Russian oil was offered at $1,400–$1,410 per metric ton on a free-on-board (FOB) basis, meaning the seller covers the cost and risk until the goods are loaded onto a ship at the agreed-upon port, while Ukrainian oil was priced at $1,380–$1,400. The price gap reflects disruptions and increased risks in Black Sea shipping.

If export problems persist into the fall, they will primarily affect farmers. Both Ukraine and Russia face a surplus of raw materials, as both countries expect high harvests, with Ukraine forecasting 13.4 million metric tons and Russia forecasting over 20 million metric tons. As a result, processors are already lowering their purchase prices.

Although Ukraine has some experience exporting via the Danube River or by rail, moving around 350,000 to 500,000 metric tons per month, its capacity is limited by damage to infrastructure. Russia, for its part, is seeking alternative routes via the Caspian Sea, Iran or the Baltic Sea. However, according to the cited websites, none of these can quickly and fully replace traditional sea routes.

(max)