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- Trafigura, Glencore and Vitol drop new transactions in Russia
- The emergence of smaller companies to transport Russian oil after the departure of major companies
- Russia’s Lukoil unit has become Russia’s largest oil trader
- East Siberian crude traders transport Russian oil directly to Asia
The new, smaller oil traders have become the savior of Russia’s oil exports, as major companies avoid doing business with Moscow following its invasion of Ukraine.
The wide spread of traders showed how Russia is overcoming the decline of Trafigura and Glencore, two of the world’s largest commodity traders, Bloomberg reports.
Russia’s ability to find brokers, ships, and buyers for its crude is central to both the global oil market and Moscow, given its impact on both global supplies and state revenues.
Abstaining from Russian oil
Glencore has not appeared as a shipping company for any quantities of Russian Urals crude since April; The company confirmed – in March – that it will abide by previous contracts, but will not sign any new commercial agreements in Russia.
Likewise, Trafigura shipments also appear to have fallen sharply this month, to 200,000 tons of Ural crude, down from more than 1 million tons in both March and April.
While Vitol came in second place, transporting 14 million barrels of crude in April and May, but it also committed to reducing Russian oil shipments.
It said – in a statement issued in April -: “Oil volumes will decline significantly in the second quarter of the year, with reduced current contractual obligations, and we expect this to be completed by the end of 2022.”
Russia’s largest oil trader
Switzerland’s Litasco, a unit of Russia’s Lukoil, has become the largest processor of Russia’s Urals crude, according to port agent reports compiled by Bloomberg.
The company chartered tankers to load at least 14 million barrels in April and 8.6 million barrels this month, far exceeding any other company’s share.
With so many buyers exiting Russian business since the war, Litasco has had to sell and ship an increasing proportion of barrels.
Litasco has also begun shipping more crude from the Arctic Sea, which would have previously gone to destinations in northern Europe and North America, to southern Italy, where the company owns an oil refinery.
Letasco explained that the company and its subsidiaries follow all laws and regulations, stressing that it is taking “all necessary measures to mitigate the impact of the international situation on operations, customers and consumers currently.”
Transformations in Asia
Important shifts are taking place in Asia, to which Russia exports about a quarter of its 350 million barrels of crude oil exports annually.
China’s Shandong Port has chartered the tanker Crete Future to transport East Siberian crude in the Russian Pacific Ocean from the Russian port of Kuzmino to China this month, according to ship brokers seen by Bloomberg.
Shandong Port, which has deep ties to oil refineries in the Chinese province of that name, has many ports, warehouses and its own fleet of ships.
The company said – in a statement published on its official account on the WeChat platform – that a tanker carrying 100,000 tons of crude is expected to arrive in Dongjiakou, near Qingdao, in mid-May.
The involvement of Shandong Port and its relationship with local companies suggests that some East Siberian crude recipients are starting to participate directly in bringing in more Russian barrels, likely because major dealers for shipments have pulled back, according to people involved in the market.
At least two Chinese oil companies and an international trading house stopped loading those cargoes from the Russian port of Kozmino, for them to be shipped to China earlier this month.
Bellatrix raises controversy
The most unusual name that deals with Russian Ural ore is a company called Bellatrix.
This month, the company had ships carrying nearly 3 million barrels of crude, according to port agent information compiled by Bloomberg.
Dealers and dealers had never heard of Bellatrix and were unable to obtain his contact information, as the name of the company is associated with one of the characters in the Harry Potter books and movies.
Bellatrix’s May shipments represent a quarter of all Urals crude from the Baltic port of Primorsk, where the company that ships Russian barrels is listed.
Other companies for transporting Russian oil
In Asia, Livna Shipping is becoming more involved in transporting Russian oil.
The Hong Kong-registered shipping company is listed as a charterer of eight ships to transport Russian East Siberian crude to China so far in May, according to data from shipping analytics firm Vortexa.
The company was a relatively young participant in April, having only two ships, and none in March.
Another emerging name is Cool Energy, which lists an address and phone number in Dubai on its website, which points to several Russian operations.
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