Russia’s exports of refined fuels continued to increase in the past week, suggesting a ramp up in crude-processing rates is filtering through into heightened shipments to overseas buyers.
(Bloomberg) — Russia’s exports of refined fuels continued to increase in the past week, suggesting a ramp up in crude-processing rates is filtering through into heightened shipments to overseas buyers.
Traders and analysts are scrutinizing every scrap of data to understand the extent to which Russia is sticking to a pledge to cut its output by 500,000 barrels a day. That has become harder to do because Moscow has made production data a state secret following the war in Ukraine.
Crude shipments, while they have remained high, slumped sharply in the most recent week as flows from its top Baltic Sea port slumped, most likely because of maintenance at the facility. In the most recent week, refined fuel cargoes climbed by more than 200,000 barrels a day, according to data from Vortexa Ltd., an analytics firm. The big gain came from diesel.
Total flows of refined fuels were 14% higher than a year ago. The recovery comes after a seven-month low observed in May when seasonal refinery maintenance was taking place.
Shipments of diesel and gasoil, which account for about 40% of Russia’s oil product flows, jumped to 1.15 million barrels a day in the observed data. That represented a 36% jump from May, with more cargoes head to buyers East of Suez following a European Union imports ban on Russian fuels in early February.
Russia’s exports of naphtha, a petrochemical feedstock used to make the building block of plastics and also in gasoline blending, edged higher to about 484,000 barrels a day, the highest since March. Most went to Asia or the Middle East.
Flows of gasoline and blending components exports remained lackluster amid signs the Russian energy ministry’s has attempted to restrict exports to prevent domestic shortages. Shipments are less than a third from May. Jet fuel exports were also muted.
Exports of refinery feedstocks, used in secondary refining units to make other fuels, also plunged so far this month. Flows are at the lowest since February.
Read: Russia Halts Some Oil Wells But Keeps Production Data Secret
Russia remains the world’s top fuel oil supplier even after losing its biggest market in the US and subsequently Europe, following Putin’s invasion of Ukraine. Displacement of more cargoes to Asia and Middle East have sustained exports. Shipments are poised to rise 17% month-month to about 795,000 barrels a day this month.
The destinations of most tankers that sailed this month are yet to signal their final discharge ports. Cargo volumes are likely to be revised as more shipments are observed for the rest of the month.
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