Western sanctions have so far failed to crush Russia’s oil exports as Moscow redirects crude to its more than willing Asian buyers China and India. European shipowners, particularly private Greek operators, transported much of Russia’s oil in the months before the EU banned imports of Russian oil by sea later this year. Greek tanker owners have increased their exposure to Russian tanker transport over the past two months as they rush to take advantage of the higher demand for heavily reduced Russian oil in China and India.
Once EU sanctions on maritime imports of Russian oil take effect in December, Greek tanker operators will have to stop shipping Russian oil. A lot biggest hit to Russian oil exports which will have dramatic consequences on the global tanker market and oil prices come from provision number two in the sixth sanctions package – EU operators will be prohibited from providing and financing the maritime transport of Russian oil to third countries.
Until the entry into force of the sanctions, European shipowners, in particular Greek ones, transport a lot of Russian oil to Asia, earn lots of money In the process. Shippers from Greece, China and Turkey are eagerly taking advantage of the situation, data shows compiled by Bloomberg. By shipping Russian ESPO crude from Kozmino to the Chinese coast, a shipowner can earn $1.6 million, three times what they would have earned before the war in Ukraine.
Earlier this month, Ukraine called out Greece for shipping Russian oil.
“We see Greek companies supplying almost the largest fleet of tankers for transporting Russian oil,” Ukrainian President Volodymyr Zelensky said. said in a speech at a conference in Athens via video link.
“Again: this is happening precisely when another Russian energy resource is being used as a weapon against Europe and against the family budget of every European. I am sure this does not meet the interests of Europe, Greece or Ukraine,” Zelensky added.
Greek shipowners made 151 calls from Russian Baltic and Black Sea ports between May 1 and June 27, up 41% from the same period last year, according to data compiled by Lloyd’s List using Lloyd’s List Intelligence. Nearly half of all crude and refined products exported from major Baltic or Black Sea ports were shipped on vessels owned by Greek tanker owners, the data shows. Billionaire George Economou’s TMS Tankers is the biggest Greek player in the Russian market and second overall, just behind Russia’s Sovcomflot, which is under Western sanctions, according to the data.
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Greek tankers are also involved in ship-to-ship (STS) transfers off Greece, Malta and south of Gibraltar, according to Lloyd’s List data.
It is difficult to predict what will happen to the global tanker market when EU sanctions come into force, but demand for oil remains high, so tankers will be used on other routes, said the CEO of a Greek shipping company. The Wall Street Journal.
“They will travel longer distances, which means they will earn more money,” added the executive.
“Dark” STS transfers of Russian crude, along with shutting down ship transponders and attempts to conceal the origin of the oil, are only expected to increase as EU sanctions approach, analysts say.
David Wech, chief economist at energy data provider Vortexa, wrote at the end of last month:
“The need to export crude and products in increasing volumes to long-haul destinations east of Suez, ideally also masking origins to attract potential buyers beyond China and India, could develop well before the entry into force of the sixth package of EU sanctions around the turn of the year.
By Tsvetana Paraskova for Oilprice.com
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