Russia’s apparent spot-market freight bills are already punishing, at USD 10 a barrel from the Black Sea to India and as much as USD 13 from the Baltic, according to Argus.^{1) 2)}

That’s not yet at the level it reached in the weeks immediately after the introduction of the price cap — when the Baltic to India trip cost more than $20 a barrel — but it’s risen by USD 4.20 a barrel, or 48%, since Jan. 10.^{3) 4)}

Following the imposition of sanctions and the price cap on Russian oil, shipping companies have faced restrictions on doing business with Russia. This has led to reduced competition and fewer available vessels, pushing up the cost of transporting Russian crude. Those willing to transport Russian crude face less competition and can charge higher rates, leading to increased freight costs.