Europe is buying up Russian diesel fuel, despite everything
Rumors say the Commission could ban all purchases of Russian diesel in February, but in the meantime European buyers are happy to pay more for Russian diesel than they did in May, industry sources told Reuters.
The ban on Russian diesel imports by sea, which is expected to come into effect as part of a broader strategy to cut Russia's revenue stream, is expected to follow the EU ban on crude oil which is expected to take effect in December. Two months later, a ban on imports of Russian diesel and all its refined products will come into effect.
The average discount on Russian diesel was $ 30 per ton in May, according to Reuters, but is now just $ 6 per ton in Northwest Europe and $ 10 per ton in the Mediterranean, thanks to increased demand.
Europe is trying to increase stocks to a level that allows it to safely get through the winter months. For the moment, the discount in Russia, even if lower than that of May, still appears interesting so there is a rush to buy that fuel until it is available.
“Whoever can, will buy Russian and stock up. The shift from gas to oil has increased demand and we are switching to winter diesel. This is one of the factors why the Russian product is no longer as cheap as it used to be, ”a European trader told Reuters.
Europe is on track to import 1.65 million bpd of diesel in September, an increase of 190,000 bpd from August levels. Meanwhile, European imports of Russian diesel have made up 44% of Europe's total diesel imports so far this month, down from 51% in August and 60% in July, as some customers decided to contact other suppliers. The Middle Eastern diesel injection rose to 30%, up from 23% last month. So Russia is enjoying this diesel rush, but buyers have already started looking around.
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The article Europe is buying up Russian diesel, despite everything, comes from ScenariEconomici.it .
This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/leuropa-fa-incetta-di-gasolio-russo-nonostante-tutto/ on Wed, 21 Sep 2022 14:55:24 +0000.