Rather than pay this all the way to China, firms including Unipec, Chinese oil behemoth Sinopec Group’s trading arm, are transporting labeled Russian oil short distances to a large vessel at sea and then transferring it, traders said.
Fewer shipping and insurance companies are willing to touch it, meaning those that still do charge prices that are three-to-five times higher than before the invasion. That makes this activity even harder to track.Ĭhinese buyers are seeking to hide Russian oil to avoid the high costs of transporting it, traders said.
There has also been a jump in ships carrying Russian crude switching off their GPS equipment, known as going dark in industry parlance, according to Israeli ship-data firm Windward. So just like for Iranian oil, the best option for Russia and its customers is increasingly to conceal its shipments.
It isn’t illegal for European or Asian refiners to buy Iranian, Venezuelan and Russian oil, but these trades are crippled by related, extensive restrictions-such as self-sanctioning banks and shipping companies-and the political risk of dealing with these countries. Lauren II is heading for Gibraltar and then expected to go to China, analysts said. It likely discharged its load, ship data showed. Last week, the Zhen 1 ship carrying Russian crude met the Lauren II, a giant crude carrier that can hold about 2 million barrels of oil, off the coast of West Africa. Will sanctions on Russia’s oil industry be effective? Why or why not? Join the conversation below. Its joint chief financial officer, Srikanth Venkatachari, said in a May 6 briefing that the company has minimized feedstock cost by sourcing “arbitrage barrels.” Reliance didn’t respond to a request for comment. “It does look like there’s a trade where Russian crude is refined in India and then some of it is sold to the U.S.” The organization is tracking Russian fossil fuel exports and their role in funding the Ukraine war. buyer,” said Lauri Myllyvirta, lead analyst at the Centre for Research on Energy and Clean Air. “What likely happened was Reliance took on a discounted cargo of Russian crude, refined it and then sold the product on the short-term market where it found a U.S. port and sailed over, discharging its cargo on May 22 in New York. Three days later, it updated its records with a U.S. Reliance chartered an oil tanker to carry a cargo of alkylate, a gasoline component, departing from the nearby Sikka port on April 21 without a planned destination. bought seven times more Russian crude in May, compared with prewar levels, making up a fifth of its total intake, according to Kpler. It previously traded largely in line with the benchmark. That is likely because of the deep discount-a popular grade of Russian crude known as Urals is priced at around $35 below Brent. The country’s imports have skyrocketed to 800,000 barrels a day since the war began, compared with 30,000 barrels a day previously, according to commodity-markets data company Kpler. India has emerged as a key hub for Russian oil flows. Russia’s oil exports rose by 620,000 barrels to 8.1 million barrels a day, close to its prewar levels, with the biggest increase going to India. Overall, Russian oil exports rebounded in April, after dropping in March as the first Western sanctions took effect, the International Energy Agency said. The embargo faced opposition from countries highly dependent on Russian crude, especially Hungary. European Union leaders took a big step in the economic fight against Moscow over its invasion of Ukraine by agreeing to block 90% of Russian oil imports by year-end.