Urals Drops to Pre‑Conflict Levels as Gulf Tensions Reignite Oil Risk

Falling Urals prices threaten Russia's oil revenues by eroding the benchmark used in its budget.

Overview

Urals crude has returned to pre‑conflict levels, averaging about $41.66 a barrel in early July and widening its discount to Dated Brent, which increases fiscal pressure on Moscow.
OPEC+ agreed a phased 188,000 barrels‑per‑day increase from August while the UAE pushed output above 3.8 million bpd, adding supply that has weighed on prices.
A temporary U.S.–Iran arrangement and alternate shipping measures briefly removed some of the Gulf risk premium, prompting traders to build large short positions.
Reported attacks on tankers, rocket strikes near the Strait of Hormuz and U.S. airstrikes on Iran with renewed sanctions drove oil futures up more than 2%, showing headline risk can quickly reverse recent declines.
Because Russian oil taxes are calculated with a lag and refinery capacity has been reduced, sustained lower Urals prices could cut state revenues in coming months and force sharper budget adjustments.