Global demand for Russian oil has taken a hit as major buyers like India and China scale back their purchases in anticipation of U.S. sanctions. This has led to a sharp decline in Russian oil prices, with the Urals crude discount against Brent reaching $23.51 per barrel, the widest gap since March 2023. Analysts suggest that the reduced demand signals growing uncertainty about the long-term viability of Russian energy exports, which could significantly impact the country’s economy and global oil markets.
The situation comes as the U.S. prepares to enforce new sanctions on Russian energy imports, with the deadline approaching. India and China, two of Russia’s largest oil buyers, have been particularly cautious, reflecting the complex geopolitical dynamics at play. These moves by major economies highlight the delicate balance between economic interests and international pressure in the current energy landscape.