According to the FGE, Russian gasoline is leaking into tanks in the United Arab Emirates and West Africa – which was previously considered a rarity.
Entitled “A bullet in the leg”. Russia Trades Oil Products Despite Western Sanctions
Western sanctions imposed a price cap on Russian naphtha of $45 a barrel, but current market prices are above that level, according to Bloomberg. In March, Russia shipped about 1.34 million tons of this oil product, which corresponds to the same period last year.
Russia has resorted to a number of secret measures in the sale of petroleum products. This allows cautious buyers to circumvent sanctions and Moscow to overcome financial hurdles put in place by the European Union and its associates, the paper writes.
Since the sanctions took effect in early February, sellers of Russian naphtha, which is mainly used in plastics and petrochemicals, have struggled to get the product to market. According to people familiar with the matter, as well as FGE and Kpler, goods are often labeled as gasoline and shipments are sent without a destination.
According to the FGE, Russian gasoline is leaking into tanks in the United Arab Emirates and West Africa – which was previously considered a rarity. “It must be naphtha or even lower grade gasoline with a large mixture,” an FGE expert suggested.
The sanctions capped the price of Russian naphtha at $45 a barrel, but current market prices are above that level. The gasoline price cap is even higher, at $100 a barrel.
The main route for many products from Moscow has been so-called “redocumenting” or mixing with non-Russian fuels in trading centers like Singapore and Fujairah in the United Arab Emirates, Bloomberg reports. This method gained momentum with the start of the NWO in Ukraine and only intensified with the imposition of sanctions.
According to Kpler, the volume of naphtha shipped from Russia to Singapore has almost quadrupled compared to last year and amounted to around 164,000 tonnes in March. Shipments to the United Arab Emirates increased from zero to 156,000 tonnes. With the onset of the conflict in Ukraine, Russian supplies of petroleum products are increasingly heading east.
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