Tightened U.S. sanctions on Moscow have disrupted a roaring trade in discounted Russian oil to China and India, reviving demand for Middle Eastern and African crudes, roiling shipping markets and driving up oil prices.

For Russian oil, tougher sanctions imposed a month ago by the outgoing Biden administration have driven up costs for refiners in China and India, with March ESPO Blend crude traded at $2 to $3 above ICE Brent on a DES basis to China, the highest premiums in more than two years, three trade sources said.

The Biden Administration’s farewell sanctions on Russian oil trade were the most aggressive yet and sanctioned dozens of vessels that Russia used to ship the ESPO crude blend from Kozmino to China’s independent refiners.

Russia's oil exports could be sustained if it finds workarounds to the latest U.S. sanctions package, the International Energy Agency (IEA) said on Thursday, as it forecast that growth in global oil supply would outpace demand this year.

Three years into the war, Russia has withstood wave after wave of sanctions, including the G7 imposing a $60 per barrel price cap on its oil sales. U.S. sanctions have not aimed to stop Russian exports, but to cap the price at which Russia can sell and to ensure it complies with the rules.

The latest US sanctions against Russia’s oil sector have led to the suspension of most Russian tankers. Source: Bloomberg Details: Currently, 94 out of 154 tankers sanctioned under the Biden administration have stopped transporting Russian oil.

Tightened U.S. sanctions on Moscow have disrupted a roaring trade in discounted Russian oil to China and India, reviving demand for Middle Eastern and African crudes, roiling shipping markets and driving up oil prices.

The sanctions, which targeted Gazprom Neft, Surgutneftegaz, and 180 shadow fleet tankers, have created a surplus of oil in Russia that cannot be exported abroad. The ports of Ust-Luga, Primorsk on the Baltic and Novorossiysk on the Black Sea have seen a 17% drop in January export deliveries,