Russian seaborne oil flows dive
September 27, 2022 - Russia’s seaborne crude exports have fallen by almost 900,000 barrels a day (bpd) in the first half of September, while U.S. oil exports to Europe will rise by more than one million bpd.
The U.K. has already stopped importing Russian crude following Moscow’s invasion of Ukraine, and the E.U. will ban imports from December 5. Europe has already cut shipborne imports of Russian oil by almost 75 per cent from pre-war levels.
Russia will ship its oil to Asia and the Middle East. At the same time, refined fuel produced in these regions will flow to the West as sanctions disrupt the global oil trade, Chief Executive Officer Russell Hardy, Chief Executive Officer of Vitol, the Dutch energy and commodity trading company, said on Monday (September 26, 2022).
“It’s going to go further and longer distances and find different markets, and in doing that, it’s going to have to trade at a discount,” Hardy told a forum at the 38th Annual Asia Pacific Petroleum Conference (APPEC) 2022 conference.
Europe will also need more infrastructure for liquefied natural gas (LNG) discharge as the continent’s infrastructure is “basically full,” Hardy added.
The U.S. could soon overtake Russia as the leading crude supplier to the E.U. and the U.K. combined -- by August, U.S. imports lagged those from Russia by just 40,000 bpd compared with a 1.3 million bpd pre-war average, according to the IEA.