Foreign oil tankers are facing temporary restrictions from loading at Russia’s main Black Sea ports due to new regulations, effectively disrupting oil exports from Kazakhstan, much of which is handled by a consortium that includes U.S. energy majors.
New Russian Regulations and Their Impact
On Monday, President Vladimir Putin signed a law mandating that foreign vessels require approval from Russia’s FSB security service to access the country’s ports. This decree, which came into immediate effect upon publication, requires permission from port authorities to be agreed upon with the FSB, the main successor to the Soviet-era KGB. This is a significant expansion of wartime maritime controls, as previously, FSB clearance was only required for ships entering ports near Russian naval bases.
This new measure has temporarily barred foreign tankers from loading at key Russian Black Sea ports, including Novorossiisk, a crucial hub for both Russian and Kazakh oil exports. This disruption could impact over 2% of global oil supply, based on Reuters calculations. The move comes just days after the European Union imposed fresh sanctions on Russia, further complicating operations for the Caspian Pipeline Consortium (CPC).
Disruption to Kazakh Oil Exports
The Caspian Pipeline Consortium (CPC) is vital for Kazakhstan, as it transports over 80% of all Kazakh oil exports through its pipeline to Russia’s Yuzhnaya Ozereevka terminal on the Black Sea. Shareholders in the CPC include significant Western energy companies such as Chevron and ExxonMobil, alongside Russian and Kazakh entities. This means the new restrictions directly impact the ability of these companies to move Kazakh oil to international markets.
While the CPC and Russia’s Ministry of Transport have not commented on the suspension, one industry source expressed optimism that the situation at the ports could be resolved within a day or two. Black Sea CPC Blend oil exports from the CPC terminal were planned at 1.66 million barrels per day for August, almost unchanged from July’s plan. Exports and oil transit via Novorossiisk were expected around 2.2 million metric tons in July.
Broader Market Jitters and Past Incidents
The Mediterranean oil markets were already on edge following a contamination scare that led to delayed loadings of Azeri BTC crude oil from the Turkish port of Ceyhan in recent days. BP, the operator of the Baku-Tbilisi-Ceyhan pipeline, confirmed on Thursday that contaminants (organic chlorides) were detected in some tanks at the Ceyhan terminal, though loadings continued from other unaffected reservoirs.
The CPC’s operations have faced disruptions before. In February, a pumping station was damaged in a suspected drone attack, and Russia briefly imposed restrictions on the CPC’s Black Sea terminal capacity in April. These recurring disruptions underscore the fragility of oil export routes in the region amidst ongoing geopolitical tensions.
Did you subscribe to our daily Newsletter?
It’s Free Click here to Subscribe!
Source: Reuters
