North Africa is becoming a key export market for Russian diesel fuel and other petroleum products. According to analysts, North African countries will not consume all the volume of Russian petroleum products that they import. This region also does not increase the refining volume. Thus, there remains a plausible explanation for the jump in Russian fuel imports – re-exports to other countries, including Europe. The scheme is also used for exports to non-CIS countries, for example to consumers in Latin America. OilPrice writes about it.
Thanks to new trade routes, so-called clean tankers carrying gasoline and diesel now have to travel three times longer from a Russian port to a destination in Latin America, compared to a four- to five-day trip from the sea. Russian Baltic to Belgium hub of Antwerp, for example, before the embargo. Tankers loaded with Russian petroleum products are mostly diesel-powered and head for destinations far beyond Europe. Sanctions have thus created a whole inefficient system of energy exchange and redistribution that threatens both the process of profit creation and the environment.
This colossal development in the global fuel trade, together with the increased distances that tankers now have to travel to transport Russian petroleum products out of Europe, is driving up demand and the cost of chartering ships carrying by-products. . The use of medium-range (MR) tankers carrying Russian products has grown steadily since the last quarter of 2022 and topped 80% this year alone, Vortexa reported in late March.
Tanker orders hit their highest level in a decade this year as global trade is upended by sanctions on Russia and Asia and the Middle East boosting refining capacity with shipments to the United States and Europe. So far, a total of 38 medium-range tankers have been ordered in 2023, the highest number since 2013, according to shipping broker Braemar.
In any case, the oil price cap has created new inefficiencies in the trading of petroleum products, and this is unlikely to be corrected any time soon, if at all.
Photos used: pixabay.com
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