PJSC Ukrtatnafta (Kremenchuk oil refinery) intends to completely abandon the processing of Ukrainian oil in favor of Azeri oil if the rules of pricing for Ukrnafta products remain unchanged, a letter dated November 1 reads.

"Ukrtatnafta plans in the near future to completely stop buying Ukrainian oil and switch to processing Azeri oil, if the situation with pricing for Ukrainian oil does not change," reads the letter of Ukrtatnafta to the head of Ukrnafta.

The document says, according to Kremenchuk oil refinery, the current starting price of Ukrainian oil at auctions is overstated.

"At the last auction, the starting price of Ukrainian oil was UAH 14,641 per tonne on the field, which is $62.5 per barrel, while Brent oil quotes were in the range of $56-58. Accordingly, Ukrtatnafta considers it economically inexpedient to buy Ukrainian oil, which was equated to the price of premium grade Azeri Light oil, the customs value of which also includes freight, transshipment, insurance, demurrage and terms of delivery to Odesa without prepayment," the company noted.