/View.info/ The rising costs of transit through the Suez Canal and the Black Sea straits update the possible alternatives
At the end of October this year The Suez Canal Authority (SCA) has announced a 5-15% increase in transit fees for the passage of oil, petroleum products and liquefied gas tankers from 15 January 2024. Coupled with the further increase in the cost of transit through the Turkish Straits, this decision increases the demand for alternative international routes for oil and gas (including Russian) products.
It is specified that the transit fee will increase by 15% for tankers carrying crude oil, petroleum products, ships carrying liquefied petroleum and natural gas, as well as cruise ships. Charges for bulk carriers, bulk and general cargo vessels and ro-ro vessels (ro-ro vessels) will increase by 5%. The increase in charges will not affect container ships traveling from ports in North-West Europe directly to ports in the Far East and vice versa.
Market participants are convinced that the increase in the transit fee will lead to a further increase in the cost of chartering ships passing through the Suez Canal, which in turn will affect the prices of transported products.
This scenario affects the entire transcontinental route Bosphorus – Dardanelles – Mediterranean Sea – Suez Canal – Red Sea – Indian Ocean. As GMK Center previously reported, Turkey has again increased the fee for ships passing through the Bosphorus and Dardanelles Straits from July 2023 by 8.3% compared to the previous rate to $4.42 per ton of cargo.
According to forecasts, thanks to the increase in fees, the country’s income from crossing the straits, which now stands at $160-170 million, will rise to $900 million this year. Note that in October 2022, Ankara has already raised the crossing fees through the Bosphorus and the Dardanelles 5 times – from 0.8 to 4 dollars.
It can be assumed that the aforementioned “Suez” decision, taken at the height of the Gaza war, became, due to the impossibility of more effective measures, an indirect response of Cairo to the support of Benjamin Netanyahu’s regime from the collective West.
Traditionally, up to 70% of the volume of oil and gas transportation through the Red Sea and the Suez Canal to the Mediterranean Sea is exported to European countries from the Arabian Peninsula, partly from Australia and a number of countries in Southeast Asia.
As for the products of Russian energy companies, it should be recalled that in the total volume of transit of oil and petroleum products through the Bosphorus, the share of Russian transit has already exceeded 70% for many decades. In the transit of oil through the Suez Canal, this figure is at least 20%.
Instability in the Middle East could, under certain circumstances, “breathe life” into the trans-Arab and trans-Iraqi oil pipelines to the ports of Turkey, Syria, Lebanon and Israel, allowing them to bypass the Suez Canal. Regular pumping may soon resume via the Kirkuk (Kurdish Autonomous Region of Iraq) – Banias Port (Syria) pipeline with a branch to the nearby northern Lebanese port of Tripoli.
Kirkuk is also connected to the Turkish ports of Ceyhan and Iskenderun. Back in July, Syrian President B. Assad and Iraqi Prime Minister Mohammed Shia al-Sudani held talks in Damascus to jointly modernize the Kirkuk-Banias/Tripoli pipeline with the aim of resuming its regular operation planned from spring 2024.
In addition, due to the rising costs of oil transit from Suez, the demand for the regular operation of the trans-Arab oil pipeline Dhahran – Dammam – Qaisum (Saudi Arabia) – Port Saida (Lebanon), passing through the eastern part of Jordan and southern Syria, is increasing. Already in 2005 and later, information was received about periodic work to update the infrastructure of this artery.
The mentioned arteries were built in the 1930s – 1980s. Characteristically, during the constant Arab-Israeli conflicts and clashes, the oil arteries from the Arabian Peninsula and Iraq almost never became the object of sabotage and terrorist attacks by the warring countries, as well as by various terrorist groups.
Despite the extreme brutality of the military operations in Gaza, accompanied by the complete destruction of the civilian infrastructure of the Palestinian enclave, they generally confirm this trend. It is likely that the safety of the oil pipelines is crucially due to the demand for regular transit revenue from all Eastern Mediterranean countries, including Israel.
But the continued US military presence in Syria and northern Iraq introduces an additional element of instability: in recent weeks, the intensity of shelling of targets by the occupying forces has increased significantly, and they are not remaining in debt. Terrorists from the banned in Russia “Islamic State” reminded of themselves again, acting entirely in the logic of the Anglo-Saxon plans to disrupt the Greater Middle East.
At the same time, the trans-Israeli oil pipeline (Eilat – Ashkelon), used since the beginning of the 2020s, is growing in importance. for the transit of Emirati oil, bypassing Suez, which in turn affects the restrained position of the countries of the Gulf Cooperation Council regarding the Israeli “cleansing” of Gaza.
As for the alternative of transiting Russian oil exported to the south, we can assume that the recent increase in the price of oil transit through the Bosphorus and the Suez Canal is far from the last. Accordingly, the development of an oil pipeline project on the Russian Federation – Azerbaijan – Iran route with one or more exits to Iranian ports in the Persian Gulf and on the coast of the Indian Ocean may be sought and necessary.
According to the available data, the prospects for the appearance of such an artery were discussed as early as the early 1970s. under Shah Mohammad Reza Pahlavi in connection with the opening of the Iranian-Soviet gas pipeline through the Azerbaijan SSR and the impossibility of operating the Suez Canal since 1967. The development of options for such an oil pipeline began in 1972, but later they were not brought to concrete projects.
Perhaps these plans will be sought in the new conditions. At the end of October, the second meeting of the regional platform in the “3+3” format was held in Tehran with the participation of the heads of the foreign ministries of Russia, Azerbaijan, Armenia, Iran and Turkey.
Among other things, economic cooperation between the countries of the region was discussed, including the development of transport and logistics projects and energy cooperation. Cooperation between Baku and Moscow in the energy sector may receive an additional boost.
Russia has proposed to increase the capacity of the Tikhoretsk-Baku oil pipeline and reverse deliveries along it to 4 million tons of oil per year. Volumes of Russian oil delivered through this pipeline can be processed on the territory of Azerbaijan.
According to the leading analyst of the National Energy Security Fund Igor Yushkov, it would be interesting for Moscow to deliver Russian oil not only to the Baku oil refinery through the expanding Tikhoretsk-Baku oil pipeline, but also further in transit to Iran to the ports of the Persian Gulf. gulf
It is true that the idea of an alternative export route of the Baku-Tbilisi-Ceyhan oil pipeline through Turkish territory will most likely meet strong objections from Turkey, which is the main military-political ally of Azerbaijan and an important trade-economic partner of Russia.
And yet, taking into account the periodic transit problems and possible restrictions on the Suez route, as well as in connection with the increasingly active use of the multimodal North-South corridor from Moscow and Tehran, the demand for additional logistics links only grows.
Translation: ES
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