/ world today news/ The huge Russian export of diesel fuel and other refined products, which many in Europe reject, is quickly being redirected to the Middle East.
Flows to the region from Russia have increased every month since February, when the conflict in Ukraine began. They reached 155,000 barrels per day in June, according to data from Vortexa (headquartered in London), which Bloomberg cited on July 13. Meanwhile, European imports of Russian fuel fell by 30% during this period.
While supplies to the Middle East are not new, current flows of oil and refined products show how the geopolitical crisis surrounding Ukraine is upending long-established trade routes and creating opportunities for traders in the Middle East and Asia, the agency said.
“As we approach the end of the year, the flow could increase,” said Jonathan Leitch, oil analyst at Turner, Mason & Co., referring to Russian diesel for buyers in the Middle East region.
According to him, it is very likely that sovereign shipping insurance will be provided to cover such deliveries of petroleum products, primarily from Russia itself.
Most of the Middle East’s imports from Russia are fuel oil, a residue from the oil refining process that is often used for power generation and shipping. Deliveries also include gasoline, diesel fuel and aviation kerosene.
Imports of oil products from Russia to the Middle East last month reached the highest level since at least early 2016. More than a third were in the oil trading and storage hub of Fujairah (United Arab Emirates).
According to Cohen Wessels, senior petroleum products analyst at Energy Aspects, tracking what happens to Russian-origin fuel after it is unloaded in Fujairah is “difficult”.
At the same time, Bloomberg’s source suggested that supplies could eventually be delayed due to future restrictions related to shipping insurance, as Russia would then depend mainly on its own fleet to transport cargo.
According to Vortexa, current imports from Russia in the Middle East will exceed the June record, with supplies exceeding 220,000 bpd between July 1 and July 11. However, they make up a relatively small part of all Russian exports of petroleum products.
They also fall far short of offsetting a drop in European imports from the country, which fell by more than half a million barrels a day between February and June, according to a Bloomberg report.
As EADaily reported, Egypt is becoming a major fuel oil supplier to Saudi Arabia. In June, the kingdom received 3.2 million barrels of fuel for its power plants from the largest Arab republic, the highest figure in at least six years, according to data from Vortexa. Meanwhile, Russia’s fuel oil imports into Egypt rose to 1.8 million barrels, the highest level since at least 2016.
Translation: SM
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