The Paper reporter Wang Lu, Wang Yiyun and Zhang Wuwei
On one side, there are a large number of oil tankers loaded with Russian crude oil “for sale” drifting on the sea with nowhere to go. On the other side, European and American countries, which have been hit by sanctions, are beginning to encounter severe energy shortages and inflation Inflation And have to "look for oil all over the world". In addition to the two, the role of "middlemen" is emerging... The conflict between Russia and Ukraine has not cleared up for a hundred days, and a dark energy war is going on outside the war zone.
As the world's third largest oil producer, Russia has always been an indispensable energy supplier to European countries. However, with the advancement of the Russian military's special military operations in Ukraine , Western countries are coerced into seeing increased sanctions against Russia as "political correctness." As a result, market concerns about supply have pushed up international oil prices, and the global oil supply chain is also experiencing rupture, turbulence and restructuring.
understands the process of restructuring the oil supply chain. Simply put, it is like the original buyer (referring to Western countries) canceling the order and looking for a new seller; the original seller (referring to Russia) losing the order and developing new buyers.
However, this process does not happen overnight. Can the United States and Europe, which are suffering from inflation, obtain commitments from other oil-producing countries to increase production? Can Russia sell oil under sanctions? This is not only a game between Western countries and Russia, but also a choice made by every economy between so-called international morality and practical needs.
European and American buyers canceled orders
html On March 6, a tanker carrying 1 million barrels of Russian crude oil departed from Murmansk Port and planned to go to its destination - Northeastern United States Philadelphia, Pennsylvania. However, 16 days after departure, just as it was sailing into the middle of the Atlantic Ocean, the tanker suddenly changed course.A reasonable speculation is that the Panamanian-flagged oil tanker named "Beijing Spirit" may have lost its original buyer. According to data from MarineTraffic, a global maritime data provider, the tanker canceled " Philadelphia " as its original destination and changed the new destination to "for order" status.
The oil on the ship can only find another way out. On March 22, the tanker made a "U-turn" in the Atlantic Ocean and sailed back towards Europe. After a few days of floating around on mediterranean , it seems to have found a new, more "friendly" buyer.
tracking data shows that in the early morning of April 1, the "Beijing Spirit" docked at Santa Panagia, an oil terminal on the east coast of Sicily, Italy. It's unclear whether the tanker's cargo has been sold or offloaded, but it is no longer signaling "for sale."
"Beijing Spirit" route map: Wang Yiyun Source: Online ship tracking service website MarineTraffic; " New York Times "
The tortuous voyage of the "Beijing Spirit" oil tanker gives us a glimpse of oil after the Russia-Ukraine conflict The process of supply chain adjustment amid turmoil. Coincidentally, two days after the "Beijing Spirit" departed from Russia, in order to "strike a powerful blow against Putin war machine", the United States announced an energy embargo on Russia on March 8, which was effective on April 22. Take effect. On the same day, the European Union also stated that it would significantly reduce oil and gas imports from Russia.
Western countries have jointly launched sanctions against Russian energy, which caters to the Western people's "moral" support for Ukraine, and a kind of "political correctness" has gradually formed within Western society.
In this environment, for fear of opposition and protests from consumers in Western markets, many companies in European and American countries had to carry out so-called "self-sanctions" and even gave up on the oil ban before it officially came into effect. or terminate business with Russia.
The oil tanker "Beijing Spirit" is not the only one affected by this. According to the " Guardian " report, on March 22, a 50,000-ton oil tanker "Minerva Virgo" carrying Russian petrochemical products and flying the Greek flag docked in New York. At that time, it was protested by the environmental organization Greenpeace, and the bright yellow bold slogan "Oil Fuels War" was particularly eye-catching.
Activists protest near the oil tanker Minerva Virgin docked in Bayonne, New Jersey.Source: Bjoern Kils/Reuters
Precisely because many Western countries and companies avoid energy transactions with Russia, data from the Finnish think tank Center for Research on Energy and Clean Air (CREA) show that other countries’ energy imports from Russia in May this year It has dropped by about 15% compared with before the Russia-Ukraine conflict. As the largest buyer of Russian energy, the EU's crude oil imports from Russia also fell by 18% in May.
It is worth noting that although the original buyers have canceled their orders one after another, there are still orders from new buyers to fill the positions. Overall, Russia’s crude oil exports did not show a downward trend in May.
Orders from Asian buyers such as India have surged
If the United States and Europe and other countries "disdain" Russian oil, then Asian buyers such as India are doing the opposite, with a surge in demand for Russia's discounted oil.
html On May 18, an oil tanker named "Huelva Star" loaded with 100,000 tons of Ural crude oil departed from the port of Ust-Luga in Russia and passed through The Baltic Sea, English Channel, Gibraltar Strait, then crossed the Mediterranean Sea, Red Sea, Arabian Sea, and finally arrived at Visakhapatnam Port (Vizag) on the east coast of India on June 21. The entire voyage lasted for one More than a month.In fact, since the outbreak of the Russia-Ukraine conflict, many oil tankers like the "Huelva Star" have frequently traveled between Russian and Indian ports. In May, Russia successfully replaced Saudi Arabia as India's second largest oil supplier. In contrast, in January and February before the conflict, India did not import crude oil from Russia.
According to data from the international commodity trading information website Refinitiv Eikon, Russia has supplied more than 24 million barrels of oil to India in May, up from 7.2 million barrels in April and 3 million barrels in March. This figure is equivalent to 25 times the average monthly delivery volume last year.
Oil tanker "Huelva Star" route map from Russia to India Drawing: Wang Yiyun Source: Emma Li
market analyst at energy analysis company Vortexa India ignores the "political correctness" among Western countries and increases the purchase of Russian oil This behavior has already caused dissatisfaction from the United States and Europe and other countries. US President Biden and White House officials have repeatedly "beaten" India, asking it to cooperate with the United States and its Western allies' actions to "block" Russian energy income, and warned India not to stand on the "wrong side of history."
Regarding the doubts and accusations from the outside world, India’s Ministry of Petroleum and Natural Gas issued a statement on May 4 to refute the fact that compared with India’s own energy consumption, the energy purchased from Russia is still negligible. "India's legitimate energy transactions should not be politicized, and energy trade is not within the scope of sanctions."
Different from the political considerations of the United States and Europe, India's decision to increase imports of Russian crude oil is mainly driven by real economic interests. After the conflict between Russia and Ukraine, global energy prices soared. Russia is selling Urals crude at a discount in response to Western sanctions, attracting new buyers at low prices. According to the "Wall Street Times", the price of the previously popular Urals crude oil is $37 lower than the Brent crude oil benchmark price, the discount is the largest in several years.
Crude oil obtained at a discount is also more conducive to the stability of India's macro economy. Like many countries around the world, India is struggling to prevent rising fuel prices from triggering runaway inflation. In the past, high oil prices have exacerbated India's current account deficit (Editor's note: refers to a country or economy where the total amount of imported goods and services is greater than the total amount of exported goods and services, that is, a state of trade deficit ), leading to a sharp depreciation of the Indian currency .
As the third largest oil consumer in the world, India relies on imports for more than 80% of its oil. In addition, India has deep historical and military ties with Russia. Naturally, it is difficult to refuse such an opportunity.
"Middlemen" make the difference?
Another trend worthy of attention is that after purchasing a large amount of discounted Russian oil, India's refined oil exports also began to increase significantly.The outside world is increasingly doubting whether India is becoming a "back door" for Russian oil to enter European and American countries?
On May 28, an oil tanker named "Hafnia Shenzhen" sailing under the flag of Singapore departed from the New Mangalore Port on the west coast of India carrying 70,000 tons of gasoline. . After a month, it arrived at New York Port in the United States on June 29.
Two days later, another oil tanker flying the Norwegian flag, named "SUSANA S", loaded with 20,000 tons of gasoline, departed from the port of Thika on the west coast of India on May 30, and arrived on June 22 Arrive at the Port of Amsterdam, Netherlands.
trade data also confirms the recent more frequent interactions between India and European and American countries. The " Wall Street Journal " report pointed out that since the Russia-Ukraine conflict, India's daily shipments of refined oil products to Europe have increased by one-third, and shipments to the United States have increased by 43% every quarter.
The recent route map for shipping refined oil products from Indian ports to Europe and the United States. Chart: Wang Yiyun Source: Emma Li
, market analyst at energy analysis company Vortexa In this regard, many analysts believe that India, as a "middleman", buys oil from Russia with the left hand and sells petroleum products to Europe and the United States with the right hand. By concealing the origin of the refined oil, Origin, enjoy high profits in the process of "one in, one out".
Since the outbreak of the Russia-Ukraine conflict, the Center for Research on Energy and Clean Air (CREA) has been tracking the flow of Russia’s fossil fuel exports. The agency said in a tweet on June 3, "Recently, our tracking shows that EU and US companies are purchasing petroleum products from a refinery in India, and the refinery has significantly increased the amount of crude oil it imports from Russia."
CREA , "Wall Street Journal" further explained the "doorway" involved, that is, after Indian refineries purchase Russian crude oil, refine it into gasoline or diesel, and then cooperate with shippers to export these refined oil to European and American countries. As a result, Russian oil is hidden in mixed refined petroleum products such as gasoline, diesel, and chemicals, making it difficult to identify and trace its origin, allowing it to evade U.S. and European sanctions.
Although the above inference is reasonable, there is currently no definite evidence that the refined oil exported by India to Europe and the United States is refined from Russian oil. Even so, we may be able to get a glimpse of the "code of wealth" from the "business practices" of India's large energy companies.
In an unusual move, India's Reliance Industries, which owns the world's largest oil refinery, decided in early May to postpone maintenance work on the refinery in order to produce more gasoline, diesel and other petroleum products. The interests behind this behavior are evident. Bloomberg reported that the energy sanctions imposed by the United States and Europe on Russia have pushed the profit margins of some petroleum products to a three-year high. A report by Reliance showed that between January and March this year, diesel margins surged 71% from the previous quarter, while petrol margins rose by 17%.
Srikanth, co-chief financial officer of Reliance Group , explained the company's profit path in early May. Srikanth said that with the strong recovery in demand for fossil fuels, "we have minimized the cost of raw materials through crude oil arbitrage."
What is the operation of "crude oil arbitrage"? An employee of an Indian private oil refining company directly pointed out to Reuters , "By processing Russian oil, the refining profit per barrel exceeds 30 US dollars, and then you can make huge profits by exporting refined fuel."
"Sanctions" and "Counter-sanctions" "The game will continue
The conflict between Russia and Ukraine has been going on for more than a hundred days. With the United States and Europe and other Western countries canceling their energy "orders" from Russia, and Russia looking for new "buyers", the global energy supply chain is undergoing drastic adjustments. and refactoring.
At the same time, this round of competition between "sanctions" and "counter-sanctions" in the energy field will in turn profoundly affect the next steps of the United States, Europe and Russia.
For Western countries, the effect of the Russian energy embargo may be far lower than expected. The surge in Asia's imports of Russian oil and the high oil prices in the international market (Editor's note: Even if Russia sells discounted oil, the current average oil price is still 60% higher than last year), have become Russia's "weapons" to resolve sanctions.
According to a report released by CREA, in the first 100 days of the Russia-Ukraine conflict, Russia earned a record 93 billion euros in revenue from oil, natural gas and coal exports. About two-thirds of this came from oil, and the rest Most comes from natural gas. It is worth mentioning that Russia’s revenue from fossil fuel exports exceeds the country’s expenditure on the war in Ukraine, which may also provide support for Russia’s continued advancement on the battlefield.
However, in the medium to long term, Russia's road to breaking through sanctions and finding buyers is still tortuous. Emma Li, a market analyst at energy analysis company Vortexa, told The Paper (www.thepaper.cn) that due to the limited domestic crude oil storage capacity in Russia, the total offshore storage capacity of Russian Ural crude oil reached a record high of 63 million barrels in early June. These have not yet been Tankers that find buyers can only temporarily float near the port. Before the Russia-Ukraine conflict at the end of February, this number was below 20 million barrels. While
used its energy "killer weapon" against Russia, the economies of the United States and European countries also suffered "backlash". Domestic gasoline and diesel prices in the United States are also setting new historical records, exacerbating the most serious inflation crisis in forty years. As the midterm elections approach, Biden, whose approval rating is hovering at a low level, is busy "looking for oil all over the world."
Forced by high oil prices, the United States has stepped down from the "moral high ground" and had to bow to reality. Recently, Biden has relaxed some sanctions and restrictions on "hostile countries" Venezuela and Iran, allowing their oil to flow into European and global markets. In addition, the "pariah countries" that Biden once called have become the current key targets of the United States. Biden will visit Saudi Arabia in July, and increasing oil production will inevitably become an unavoidable issue.
On the other side of the Atlantic, the preliminary value of the euro zone's consumer price index
(CPI) surged 8.1% year-on-year in May, reaching a record high. Rabobank expects the euro zone economy to enter recession at the end of 2022 or early 2023. To ease the energy crisis, European refiners are turning their attention to West African oil.The new supply may not be able to fill Europe's energy shortage, and some European countries still have difficulty breaking away from their long-term dependence on Russian energy. Recently, Russian oil flows to Europe have quietly increased. Continental Europe's refineries imported an average of 1.84 million barrels of crude oil per day from Russia in mid-June, increasing for the third consecutive week and reaching the highest level in nearly two months, according to tanker tracking data compiled by Bloomberg.
In the shadow of the Russia-Ukraine conflict and Europe's oil ban on Russia, these tankers, which bear high risks and travel between Russia and Europe, are particularly cautious. Most of them choose to turn off their GPS tracking transponders and sneak "invisibly" to the outside world. It's hard to know where it will eventually go.
The confrontation on the military battlefield may eventually end, but the impact and structural changes of the energy secret war on the world will continue.
Editor in charge: Li Yiqing Picture editor: Hu Mengzhen
Proofreading: Luan Meng
Source: Bjoern Kils/ReutersPrecisely because many Western countries and companies avoid energy transactions with Russia, data from the Finnish think tank Center for Research on Energy and Clean Air (CREA) show that other countries’ energy imports from Russia in May this year It has dropped by about 15% compared with before the Russia-Ukraine conflict. As the largest buyer of Russian energy, the EU's crude oil imports from Russia also fell by 18% in May.
It is worth noting that although the original buyers have canceled their orders one after another, there are still orders from new buyers to fill the positions. Overall, Russia’s crude oil exports did not show a downward trend in May.
Orders from Asian buyers such as India have surged
If the United States and Europe and other countries "disdain" Russian oil, then Asian buyers such as India are doing the opposite, with a surge in demand for Russia's discounted oil.
html On May 18, an oil tanker named "Huelva Star" loaded with 100,000 tons of Ural crude oil departed from the port of Ust-Luga in Russia and passed through The Baltic Sea, English Channel, Gibraltar Strait, then crossed the Mediterranean Sea, Red Sea, Arabian Sea, and finally arrived at Visakhapatnam Port (Vizag) on the east coast of India on June 21. The entire voyage lasted for one More than a month.In fact, since the outbreak of the Russia-Ukraine conflict, many oil tankers like the "Huelva Star" have frequently traveled between Russian and Indian ports. In May, Russia successfully replaced Saudi Arabia as India's second largest oil supplier. In contrast, in January and February before the conflict, India did not import crude oil from Russia.
According to data from the international commodity trading information website Refinitiv Eikon, Russia has supplied more than 24 million barrels of oil to India in May, up from 7.2 million barrels in April and 3 million barrels in March. This figure is equivalent to 25 times the average monthly delivery volume last year.
Oil tanker "Huelva Star" route map from Russia to India Drawing: Wang Yiyun Source: Emma Li
market analyst at energy analysis company Vortexa India ignores the "political correctness" among Western countries and increases the purchase of Russian oil This behavior has already caused dissatisfaction from the United States and Europe and other countries. US President Biden and White House officials have repeatedly "beaten" India, asking it to cooperate with the United States and its Western allies' actions to "block" Russian energy income, and warned India not to stand on the "wrong side of history."
Regarding the doubts and accusations from the outside world, India’s Ministry of Petroleum and Natural Gas issued a statement on May 4 to refute the fact that compared with India’s own energy consumption, the energy purchased from Russia is still negligible. "India's legitimate energy transactions should not be politicized, and energy trade is not within the scope of sanctions."
Different from the political considerations of the United States and Europe, India's decision to increase imports of Russian crude oil is mainly driven by real economic interests. After the conflict between Russia and Ukraine, global energy prices soared. Russia is selling Urals crude at a discount in response to Western sanctions, attracting new buyers at low prices. According to the "Wall Street Times", the price of the previously popular Urals crude oil is $37 lower than the Brent crude oil benchmark price, the discount is the largest in several years.
Crude oil obtained at a discount is also more conducive to the stability of India's macro economy. Like many countries around the world, India is struggling to prevent rising fuel prices from triggering runaway inflation. In the past, high oil prices have exacerbated India's current account deficit (Editor's note: refers to a country or economy where the total amount of imported goods and services is greater than the total amount of exported goods and services, that is, a state of trade deficit ), leading to a sharp depreciation of the Indian currency .
As the third largest oil consumer in the world, India relies on imports for more than 80% of its oil. In addition, India has deep historical and military ties with Russia. Naturally, it is difficult to refuse such an opportunity.
"Middlemen" make the difference?
Another trend worthy of attention is that after purchasing a large amount of discounted Russian oil, India's refined oil exports also began to increase significantly.The outside world is increasingly doubting whether India is becoming a "back door" for Russian oil to enter European and American countries?
On May 28, an oil tanker named "Hafnia Shenzhen" sailing under the flag of Singapore departed from the New Mangalore Port on the west coast of India carrying 70,000 tons of gasoline. . After a month, it arrived at New York Port in the United States on June 29.
Two days later, another oil tanker flying the Norwegian flag, named "SUSANA S", loaded with 20,000 tons of gasoline, departed from the port of Thika on the west coast of India on May 30, and arrived on June 22 Arrive at the Port of Amsterdam, Netherlands.
trade data also confirms the recent more frequent interactions between India and European and American countries. The " Wall Street Journal " report pointed out that since the Russia-Ukraine conflict, India's daily shipments of refined oil products to Europe have increased by one-third, and shipments to the United States have increased by 43% every quarter.
The recent route map for shipping refined oil products from Indian ports to Europe and the United States. Chart: Wang Yiyun Source: Emma Li
, market analyst at energy analysis company Vortexa In this regard, many analysts believe that India, as a "middleman", buys oil from Russia with the left hand and sells petroleum products to Europe and the United States with the right hand. By concealing the origin of the refined oil, Origin, enjoy high profits in the process of "one in, one out".
Since the outbreak of the Russia-Ukraine conflict, the Center for Research on Energy and Clean Air (CREA) has been tracking the flow of Russia’s fossil fuel exports. The agency said in a tweet on June 3, "Recently, our tracking shows that EU and US companies are purchasing petroleum products from a refinery in India, and the refinery has significantly increased the amount of crude oil it imports from Russia."
CREA , "Wall Street Journal" further explained the "doorway" involved, that is, after Indian refineries purchase Russian crude oil, refine it into gasoline or diesel, and then cooperate with shippers to export these refined oil to European and American countries. As a result, Russian oil is hidden in mixed refined petroleum products such as gasoline, diesel, and chemicals, making it difficult to identify and trace its origin, allowing it to evade U.S. and European sanctions.
Although the above inference is reasonable, there is currently no definite evidence that the refined oil exported by India to Europe and the United States is refined from Russian oil. Even so, we may be able to get a glimpse of the "code of wealth" from the "business practices" of India's large energy companies.
In an unusual move, India's Reliance Industries, which owns the world's largest oil refinery, decided in early May to postpone maintenance work on the refinery in order to produce more gasoline, diesel and other petroleum products. The interests behind this behavior are evident. Bloomberg reported that the energy sanctions imposed by the United States and Europe on Russia have pushed the profit margins of some petroleum products to a three-year high. A report by Reliance showed that between January and March this year, diesel margins surged 71% from the previous quarter, while petrol margins rose by 17%.
Srikanth, co-chief financial officer of Reliance Group , explained the company's profit path in early May. Srikanth said that with the strong recovery in demand for fossil fuels, "we have minimized the cost of raw materials through crude oil arbitrage."
What is the operation of "crude oil arbitrage"? An employee of an Indian private oil refining company directly pointed out to Reuters , "By processing Russian oil, the refining profit per barrel exceeds 30 US dollars, and then you can make huge profits by exporting refined fuel."
"Sanctions" and "Counter-sanctions" "The game will continue
The conflict between Russia and Ukraine has been going on for more than a hundred days. With the United States and Europe and other Western countries canceling their energy "orders" from Russia, and Russia looking for new "buyers", the global energy supply chain is undergoing drastic adjustments. and refactoring.
At the same time, this round of competition between "sanctions" and "counter-sanctions" in the energy field will in turn profoundly affect the next steps of the United States, Europe and Russia.
For Western countries, the effect of the Russian energy embargo may be far lower than expected. The surge in Asia's imports of Russian oil and the high oil prices in the international market (Editor's note: Even if Russia sells discounted oil, the current average oil price is still 60% higher than last year), have become Russia's "weapons" to resolve sanctions.
According to a report released by CREA, in the first 100 days of the Russia-Ukraine conflict, Russia earned a record 93 billion euros in revenue from oil, natural gas and coal exports. About two-thirds of this came from oil, and the rest Most comes from natural gas. It is worth mentioning that Russia’s revenue from fossil fuel exports exceeds the country’s expenditure on the war in Ukraine, which may also provide support for Russia’s continued advancement on the battlefield.
However, in the medium to long term, Russia's road to breaking through sanctions and finding buyers is still tortuous. Emma Li, a market analyst at energy analysis company Vortexa, told The Paper (www.thepaper.cn) that due to the limited domestic crude oil storage capacity in Russia, the total offshore storage capacity of Russian Ural crude oil reached a record high of 63 million barrels in early June. These have not yet been Tankers that find buyers can only temporarily float near the port. Before the Russia-Ukraine conflict at the end of February, this number was below 20 million barrels. While
used its energy "killer weapon" against Russia, the economies of the United States and European countries also suffered "backlash". Domestic gasoline and diesel prices in the United States are also setting new historical records, exacerbating the most serious inflation crisis in forty years. As the midterm elections approach, Biden, whose approval rating is hovering at a low level, is busy "looking for oil all over the world."
Forced by high oil prices, the United States has stepped down from the "moral high ground" and had to bow to reality. Recently, Biden has relaxed some sanctions and restrictions on "hostile countries" Venezuela and Iran, allowing their oil to flow into European and global markets. In addition, the "pariah countries" that Biden once called have become the current key targets of the United States. Biden will visit Saudi Arabia in July, and increasing oil production will inevitably become an unavoidable issue.
On the other side of the Atlantic, the preliminary value of the euro zone's consumer price index
(CPI) surged 8.1% year-on-year in May, reaching a record high. Rabobank expects the euro zone economy to enter recession at the end of 2022 or early 2023. To ease the energy crisis, European refiners are turning their attention to West African oil.The new supply may not be able to fill Europe's energy shortage, and some European countries still have difficulty breaking away from their long-term dependence on Russian energy. Recently, Russian oil flows to Europe have quietly increased. Continental Europe's refineries imported an average of 1.84 million barrels of crude oil per day from Russia in mid-June, increasing for the third consecutive week and reaching the highest level in nearly two months, according to tanker tracking data compiled by Bloomberg.
In the shadow of the Russia-Ukraine conflict and Europe's oil ban on Russia, these tankers, which bear high risks and travel between Russia and Europe, are particularly cautious. Most of them choose to turn off their GPS tracking transponders and sneak "invisibly" to the outside world. It's hard to know where it will eventually go.
The confrontation on the military battlefield may eventually end, but the impact and structural changes of the energy secret war on the world will continue.
Editor in charge: Li Yiqing Picture editor: Hu Mengzhen
Proofreading: Luan Meng
