Trump's Calculation on Russian Oil: 69-70 Dollars Is Just Right

June 23, 2025

13:00

Primorsky — the largest oil port in the Baltic Sea. Photo.

American bombing of Iranian nuclear facilities further pushed up international oil prices. At the same time, Russian oil prices have reached the budget forecast level. Experts believe that this price level is just right for Russian oil, neither high nor low.

From Saturday to Sunday night, the United States launched attacks on Iranian nuclear facilities, effectively intervening in the Israel-Iran conflict. Market concerns about Iran potentially blockading the Strait of Hormuz (where over 20% of global oil is transported) drove crude oil prices to continue rising. On June 23, the Brent crude oil benchmark price rose to $77 per barrel.

The surge in international oil prices also boosted the price of Russian crude oil. According to data from ProFinance.ru, the price of Russia's most popular Urals crude oil has risen to $70. This is an estimated value, but it still shows a significant increase in Russian oil prices — at the beginning of May, its export price even fell to $52, while the current price now matches the target set by the Russian government for this year's budget.

Rising Oil Prices Benefit Russia, but High Prices Become a Burden

Igor Yushkov, chief analyst at the Russian Foreign Trade Bank and expert at the Russian Government Institute of Finance, pointed out that Russian oil suppliers have benefited from the escalation of the Israel-Iran conflict.

"At least since the outbreak of the conflict, the price of oil per barrel has increased by $10, and we have made more money because of this. In addition, the entire situation has prompted China to consider signing the 'Power of Siberia 2' agreement, to obtain a more reliable natural gas supply. Even from a political perspective, all attention is currently focused on the Israel-Iran conflict rather than Ukraine. US military aid is also being directed towards Israel, not Ukraine."

He believes that if the Strait of Hormuz is blocked and oil prices surge, it would be detrimental to Russia, as this would suppress global market oil demand.

"The current price of Brent crude oil at $75-$80 is very profitable for us. Russian oil usually has a discount of around $10, so our price range is $65-$70 — this is crucial for us," Yushkov emphasized.

He added that a deal between Iran and the United States would also not be in Russia's interest, as the US could then lift some sanctions on Iran, increasing its production and causing oil prices to fall. "Therefore, the current ongoing tension and mutual attacks — this 'status quo' is beneficial for Russia."

The EU Tried to Lower the Price Cap on Russian Oil, But the Surge in Oil Prices Disrupted the Plan

As previously reported, due to the drop in international oil prices and the appreciation of the ruble, Russian oil and gas revenue has been continuously decreasing. Data from the Russian Ministry of Finance showed that oil and gas revenue in May dropped to 512 billion rubles, the lowest level in recent years.

The EU had proposed lowering the price cap on Russian oil from $60 to $45, but the surge in international oil prices made Brussels change its mind. European Commission President Ursula von der Leyen stated at the G7 summit in Canada that the sanctions against Russian oil had limited effect, and the price was largely dependent on the benchmark price — Urals crude oil is traded with a discount to the benchmark price.

Original: https://www.toutiao.com/article/7519315187917193764/

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