The volume of global seaborne oil transport declines as Russian oil exports plummet - Bloomberg reports.
The volume of Russian crude oil exports from major western ports fell to a 19-month low in July, exacerbating the overall decline in global seaborne oil transport - Bloomberg notes.
Global oil transport volume decreased by about 586,000 barrels per day in July - according to tanker tracking data collected by Bloomberg.
Total oil shipments to China fell by more than 1.4 million barrels per day - the largest drop recorded this year, although figures may vary.
Increases from top oil-exporting countries Saudi Arabia and the U.S. helped offset lower shipments from Russia, Brazil, Venezuela, and Qatar.
Russian oil exports - primarily the flagship Ural oil - from the Baltic ports of Primorsk and Ust-Luga, and Novorossiysk on the Black Sea, fell to nearly 1.8 million barrels per day in July. In June, this figure was 2.2 million barrels/day.
Russia has improved compliance with OPEC+ production targets and is ramping up domestic refining activities, which may reduce the volume of oil exported abroad.
A separate analysis this week showed that total Russian seaborne crude oil exports fell to the lowest level in nearly a year, while exports from Baltic ports were at their lowest since December 2022.
Also due to the commitment to cut oil production with OPEC+, Russia's oil industry has slowed drilling activities this year compared to the record highs recorded in 2023.
In the first half of 2024, rigs used by Russian oil companies drilled a total of 14,370 km of oil wells in Russia, down 2.5% compared to the first half of 2023.
The record-high drilling rate in 2023 indicated that Russian producers were trying to maximize output from old oil fields to keep production rates from declining.
But this year, Russia's drilling activities have decreased from the record highs of 2023 as Russia is further cutting production.
"They drill enough to maintain stability and ensure spare capacity, but not much more," - Sergey Vakulenko, a scholar at the Carnegie Endowment for International Peace, told Bloomberg.
Previously, Vakulenko was an executive at a Russian oil producer for a decade.
Russia is striving to comply with OPEC+ production quotas. Russia has pledged to adhere to the cuts to compensate for overproduction in previous months while domestic refining levels are approaching a six-month high in July amid peak demand.
Russian Deputy Prime Minister Alexander Novak stated there were no disagreements between Russia and OPEC+ regarding Moscow's recent poor compliance with the group's production cut agreements.
The Russian Energy Ministry said Russia's oil production has declined each month since April.
