Russia’s exports of refined fuels continued to rise last week, suggesting that a rise in crude processing rates is filtering into increased shipments to foreign buyers.
Traders and analysts are poring over every piece of data to understand how well Russia is sticking to its pledge to cut output by 500,000 barrels a day. This has become more difficult to do because Moscow has made production data a state secret after the war in Ukraine.
Crude shipments, while remaining high, fell sharply in the most recent week as flows from its main Baltic Sea port eased, likely due to facility maintenance. In the most recent week, refined fuel shipments rose by more than 200,000 barrels a day, according to data from Vortexa Ltd., an analytics firm. The big gain came from diesel.
Total refined fuel flows were 14% higher than a year ago. The recovery comes after a seven-month low seen in May, when the refinery was undergoing seasonal maintenance.
Shipments of diesel and diesel, which account for about 40 percent of Russia’s oil product flows, rose to 1.15 million barrels per day, data observed. This was a 36% increase on May, with more cargoes directed to buyers east of Suez following the European Union’s ban on Russian fuel imports in early February.
Exports of Russia’s naphtha, a petrochemical feedstock used to make the building block of plastics and also to blend gasoline, rose to 484,000 barrels a day, the highest since March. Most went to Asia or the Middle East.
Export flows of gasoline and blending components remained lackluster amid signs that Russia’s energy ministry has sought to restrict exports to avoid domestic shortages. Shipments are less than a third as of May. Jet fuel exports were also muted.
Exports of refinery raw materials, used in secondary refining units to make other fuels, also fell so far this month. The flows are the lowest since February.
Russia remains the world’s largest fuel oil supplier even after losing its biggest market to the US and later Europe following Putin’s invasion of Ukraine. Shifting more cargo to Asia and the Middle East has sustained exports. Shipments are poised to rise 17% month-on-month to about 795,000 barrels a day this month.
The destinations of most of the tankers that sailed this month have not yet indicated their final discharge ports. Cargo volumes are likely to be revised as more shipments are observed throughout the remainder of the month.
