Back in October, the Trump administration announced sanctions on Russia’s two biggest oil companies: Rosneft and Lukoil. At the time, I wrote that this was a very big deal for two reasons: (i) it marks the first time the Trump administration has used sanctions against Russia; and (ii) it sharply raises the stigma around buying Russian oil, as secondary sanctions by the US carry the threat of freezing potential buyers out of Dollar payment networks. I predicted that the discount on Urals crude versus Brent would widen significantly, which is exactly what’s happened. In percentage terms, the Urals oil price has fallen ... (full story)