As discussed yesterday in "Buyers Balk At Russian Oil Purchases Despite Record Discounts, Sanction Carve Outs" the bevy of Russian sanctions have had the unintended consequence of also freezing Russian oil exports - despite explicit carve outs in terms set by Western nations - as buyers balk and boycott Russian crude sales amid fears that the country's energy supplies may eventually fall under a sanctions regime anyway, leaving buyers stuck with millions in barrels they can't then sell to downstream clients.

Today was a clear example of just that: citing traders with knowledge of tenders, Bloomberg reported that Surgutneftegaz (better known as Surgut) failed to award two tenders with combined volume of 880k tons of Urals for March loading.

This was the third time that Surgut failed to sell any of the crude it was offering, "highlighting the difficulty for Russian producers to find buyers after the nation's invasion into Ukraine."

In a separate, smaller tender, Surgut was offering 8 cargoes of 100k tons each from Baltic ports, and another 80k tons cargo from Black Sea in a separate tender. It was unclear if any bidders stepped up for those.

Of course, the longer Russia, and its roughly 6 mm barrels in daily oil exports remain stuck, the greater the cumulative price shock will be. Commenting on this, Bloomberg's Alaric Nightingale said that there's a clear and obvious short-term supply shock for Russian oil and that's why prices are marching ever higher, having hit a decade high of $114 earlier today before stabilizing around $110.