Exxon’s Former Russian Oil Project Is Ramping Up Flows Again

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After Russia seized control of the nation’s Far Eastern project from Exxon Mobil Corp., which had promised to leave the country in the wake of the invasion of Ukraine, oil exports from Sakhalin-1 are increasing.

First export

According to information gathered by Bloomberg, two tankers recently loaded Sokol crude from the De-Kastri terminal, and both of the boats indicated Yeosu in South Korea as their destination. This marked the project’s first exports in five months. Rosneft PJSC, a Russian oil company, published a bidding last week that was closed in order to sell six quick cargoes, most of which were for loading in November.

Deals settled?

Since May, when Exxon first announced its desire to leave the nation, the business has been reducing output at Sakhalin-1. In response, Moscow terminated the corporation’s involvement in the project and handed it over to a Russian operator. Sokol can be delivered in three to five days to significant refining centres in China and South Korea.

According to dealers participating in the Asian market who asked not to be identified because the information is private, some Sokol cargoes provided by Rosneft were at a discounted price to the Dubai benchmark on a delivered basis to China. According to them, it’s unclear whether the deals were actually settled.

Financial difficulties 

Smaller trading firms were also involved in selling the cargo because purchasers would have been concerned about reputational harm or financial difficulties if they had dealt directly with the Russian oil corporation, according to merchants. They stated that China and India are the most likely destinations for Sokol shipments.

Early in December, the European Union will impose fresh sanctions on Moscow that will forbid European firms from offering insurance and other crucial services for Russian oil exports. Due to this, Indian refiners have halted spot purchases while they evaluate the potential consequences.

Next load

Following the loading of Sokol, Victor Konetsky and Vladimir Arsenyev signalled Yeosu, according to ship-tracking information obtained by Bloomberg. Pavel Chernysh is on his way to the port, but Yuri Senkevich has been anchored off De-Kastri since April and is most likely to be the next to load Sokol.

Each of the four ships is a shuttle tanker that is frequently used to transfer cargoes of Sokol from De-Kastri to Yeosu.

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Source: Bloomberg

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