Russia's main oil product is trading way below the $60 price cap as just a handful of buyers keep up trade with the heavily sanctioned nation

• Russia's Urals blend is now trading well below the $60 price cap at just $37.80 a barrel, according to data from Argus Media.
• That's less than half the international benchmark Brent crude, squeezing Russia's oil revenue.
• The nation is struggling to replace European oil customers, and has just a few large oil buyers remaining.

Russia's main oil product is now trading way below the G7's $60 price cap, as the heavily sanctioned nation only has a handful of buyers to keep up its crude oil trade.

Urals grade, Russia's largest crude oil export, traded at its Baltic Sea port at just $37.80 a barrel on Friday, according to data from Argus Media.

In addition to lagging below the price cap, that's less than half the price of international benchmark Brent crude, which was trading at about $80 a barrel on Monday.

Western nations slapped the price cap on top of the European Union's ban of Russian oil in December, part of the latest round of sanctions intended to crimp Moscow's war revenue.

Europe was one of Russia's largest crude oil customers, and Russian oil suppliers are now unable to use Western shipping and insurance services unless they agree to abide by the price cap mechanism.

It's been difficult for Russia to navigate those headwinds: the nation's oil export revenue fell $15 million in the last week of 2022, and there are just a few main buyers of Russian crude left, namely China, India, and Turkey, Bloomberg reported.

Those customers have also been able to score steeper discounts on oil as Russia struggles to replace European oil sales. Russia had sold oil below the price cap to India, and at least one oil shipment was sold to China at $68 a barrel, just above the price cap level.

President Vladimir Putin has called the price cap "stupid" and emphasized the resilience of Russia's economy, though its central bank has warned that the latest round of sanctions were new economic shocks to the nation. The damage done by sanctions could even cause Russia to become a failed state or break up by 2033, according to a recent survey of experts.

Russia has refused to formally abide by the price cap mechanism and threatened to retaliate against any country that enforces it, such as by slashing its oil output by 700,000 barrels a day. That, along with the 1 million barrel-a-day drop expected from the EU ban, could cause oil prices to spike past $100 a barrel, UBS warned.