In response to broad U.S. sanctions, Russian oil exporters are adjusting their supply chains, with unsanctioned tankers stepping in to maintain crude shipments.
Key Developments
New Tankers in the Pacific Trade
- Ling Hong (formerly Suvretta), a 17-year-old Aframax tanker, docked at Kozmino over the weekend.
- It loaded 670,000 barrels of ESPO crude for delivery to Dongying, China on Feb. 7.
- Another unsanctioned tanker, Bhilva, is expected to dock at Kozmino on Monday.
Shifting Logistics Amid Sanctions
- Biden administration sanctions targeted 70% of Kozmino’s servicing fleet.
- Traders have adopted a new pricing model, and shipping costs have surged.
- Some tankers previously transporting oil from Russia’s western terminals have been redirected east.
New Entrants in the Baltic Trade
- Breeze III, a 20-year-old Aframax, loaded 660,000 barrels at Ust-Luga (Baltic Sea) in January.
- The vessel sailed through the Mediterranean & Suez Canal, currently near Ain Sukhna, Egypt.
- It is expected to reach Saudi Arabia later this week.
Market Impact & Outlook
- Chinese refiners remain the key buyers of Russian ESPO crude.
- RBC Capital Markets analysts suggest that logistics are evolving to sustain Russian oil exports while avoiding sanctions risks.
- As sanctions disrupt traditional routes, unsanctioned tankers and alternative pricing models are emerging to maintain crude flows.
Bottom Line: Despite U.S. pressure, Russia’s oil supply chain is adapting, with new tankers ensuring continued exports to key buyers like China and the Middle East.
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Source: gCaptain
