Russia’s Rosneft fails to sell oil in tender after demanding payment in rubles

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Russia’s Rosneft failed to sell oil in a jumbo tender after demanding prepayment in rubles, five traders said on Monday, meaning the country’s top oil producer will need to find ways to divert more crude to buyers in Asia through private deals.

Rosneft was unable to award a tender to sell 6.5 milliontonnes of Urals, Siberian Light, Sokol and ESPO Blend oil loading from Russian ports in May-June because there were no bids from buyers, the traders said.

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Rosneft did not immediately respond to requests for comment.

It was extremely hard to meet the tender terms, traders said, after Rosneft asked for 100% prepayment and converting the
payment into rubles.

The sale would have been difficult enough without the updated terms, they added, as most European majors and even
international trading firms are winding down purchases from Rosneft amid caution about Western sanctions on Russia and various payment and shipping issues.

India’s state refiners did not submit bids in tenders issued by Rosneft as the terms were “one-sided,” two sources familiar with the matter said on Thursday.

Two traders said that offered volumes of Far East oil grades, Sokol and ESPO Blend for loading in May were difficult to place with end users as the trading cycle for May volumes had ended about a month ago.

“Specific terms and a thin timeframe require individual negotiations,” a source with an Asian trading firm said, adding that some of the volumes offered could be sold in private deals.

Another source familiar with Rosneft’s tender said that the main goal of the tender was to “announce a ruble payment requirement to the market,” which had been achieved.

The tender closed on April 21. The awards had been expected to be announced on April 26.

Read more: Russian gas flows to Europe stable as gas nominations for Slovakia rise via Ukraine

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