What happened
According to Kpler and reports from Bloomberg, as of December 17 at least five tankers carrying Urals crude were idling in the Yellow Sea, totaling about 3.4 million barrels. The volume in the area has doubled compared with the previous week and is the highest in more than five years.
Why this happened
The key reason is a drop in purchases by India, which before the war was the largest buyer of Urals. Partly this is a reaction to U.S. sanctions (including measures against Rosneft and Lukoil that took effect on November 21) and to increased scrutiny by partners of energy trade with Russia.
"The accumulation of Urals near China is a unique situation that has drawn the attention of oil traders worldwide, since Chinese refineries are not typical buyers of this grade."
— Bloomberg
With limited demand, sellers are looking for alternative markets across East Asia, which drives up supertanker freight rates and alters supply logistics.
"As of December 17 at least five vessels were idle in the Yellow Sea carrying about 3.4 million barrels"
— Kpler (data)
Consequences for Russia and the market
First, lower demand and the surplus of tankers are widening discounts on Urals — it has already been reported that the average price of Russian crude fell to around $40 per barrel for cargos from the Baltic and Black Seas and from the port of Kozmino.
Second, the fall in purchases contributes to a reduction in Moscow's export revenues. As the President of Ukraine emphasized on November 12, sanctions and strikes on logistics could significantly reduce Russia's revenue in 2025.
"Russia could lose at least $37 billion in oil and gas revenues in 2025 due to sanctions and Ukrainian long-range strikes."
— Volodymyr Zelensky, President of Ukraine (November 12)
Third — for the global market this means rerouting and increased volatility in freight rates. Trading houses and refineries in the region will balance between attractive offers and the reputational and regulatory risks of sanctions.
What this means for Ukraine
Sanctions pressure and the restriction of markets for Russian oil are working — the numbers and the build-up of tankers confirm this. At the same time it is important to monitor possible sanction-evasion routes and new channels for buying energy: blocking those would turn a temporary effect into a sustained reduction in the aggressor's revenues.
Brief conclusion: this is not an isolated incident but part of a broader shift in energy trade following the sanctions. The coming week will show whether the tanker surplus remains a temporary phenomenon or turns into a systemic problem for Russian revenues.
