The U.S. Treasury on Friday announced sweeping new sanctions against the Russian energy sector, including oil majors Gazprom Neft (SIBN.MM) and Surgutneftegaz (SNGS.MM), to try to hinder Moscow in its war with Ukraine.
Below are reactions from major brokerages and agencies:
GOLDMAN SACHS
"Friday's announcement strengthens our view that the risks to our $70-85 Brent range forecast are skewed to the upside in the short term."
"We estimate that the vessels targeted by the new sanctions transported 1.7mb/d of oil in 2024 or 25% of Russia's exports, with the vast majority being crude oil."
"Across scenarios, the long-term price impact of lower sanctioned supply is limited because we assume that OPEC+ would stabilize the market by deploying its high spare capacity and by raising production for longer than in our base case."
KPLER
"The latest sanctions have targeted tankers accounting for about 42% of Russia's seaborne oil exports, primarily to China."
"Reduction in fleet supply from Russia will drive freight rates from Russia higher."
"Limited impact on Russian oil output seen for now, but we anticipate a decline of 150 kbd by late Q3. Crude exports should remain stable, however, as priority is given to crude over dirty products exports."
CITI
"Knowing almost 30% of the shadow fleet is being targeted with this latest round of sanctions, it would imply a loss of around 0.8-m b/d of crude oil exports."
JP MORGAN
"Despite new sanctions, Russia has some room to maneuver but will ultimately need to acquire non-sanctioned tankers or offer crude at or below $60 to use Western insurance and tankers, per West's pricing cap."
"The new measures are likely to give the Trump administration additional leverage in future negotiations with Russia, as it decides whether, when, and under what terms to lift Biden-imposed sanctions."
RBC CAPITAL MARKETS
"The new Russian sanctions from the outgoing administration are a net addition to at-risk supply, adding more uncertainty to the 1Q'25 outlook. At face value, there’s a case for Brent to reach the upper $80/bbl range in the near term, all barrels considered, despite margin headwinds. That said, we've seen this scenario multiple times in recent years, and supply chain resilience has consistently outperformed."
ANZ
"...(Russia's) ability to ship oil will be further compromised by new U.S. sanctions on its oil industry. The main target of the sanctions, Gazprom and Surgutneftegas, handled about 970kb/d of oil by sea in the first 10 months of 2024. There have also been reports that some Chinese ports are being urged to forbid sanctioned oil tankers from docking or unloading at their terminals."
