Refinery attacks boost June Russian crude exports, dampen products

Continued attacks on Russian refining infrastructure weighed on Russian refined product exports in June, amid domestic shortages, freeing up more crude for international deliveries, according to S&P Global Energy cargo-tracking software.

Seaborne exports of Russian crude were 4.414 million barrels/day in June, up 9% on the month and up 28% on the year, data from S&P Global Commodities at Sea showed July 2.

This came despite a slump in exports to key buyer India. India imported 939,300 b/d of Russian crude in June, down 59% on the month and down 42% on the year, CAS data showed. Russian crude exports to China were 965,600 b/d in June, up 12% on the month and up 6% on the year.

The US waiver for oil on water, extended several times by the US Treasury Department since the start of the war in the Middle East, expired on June 17. However, Indian authorities said in May that the US license had little impact on their purchase choices.

Russian crude shipments to Singapore surged to 796,800 b/d, up 581% on the month and up 1,090% on the year.

Russian Urals crude has been losing value to international benchmarks. Platts, part of S&P Global Energy, assessed the discount of Urals on a FOB basis at Primorsk to Dated Brent at an average of $25.17/b through June, compared to $21/b in May and against a five-year average of $19.78/b.

Since then, it has grown, as Platts assessed it at $27.93/b July 1.

Refinery attacks

Seaborne exports of Russian refined products in June were 1.611 million b/d in June, down 15% on the month and down 31% on the year, CAS data showed.

Exports to Egypt, chiefly a transshipment hub rather than an end-destination, were 389,394 b/d in June, up 25% on the month and up 340% on the year.

Turkey was another key importer at 311,169 b/d in June, although this was down 19% on the month and down 36% on the year.

Refinery outages after drone strikes, coupled with seasonally high demand for both gasoline and diesel, are increasingly aggravating a fuel crisis in Russia, with regional authorities introducing limits on fueling cars and market sources reporting shortages.

On June 28, Russia's President Vladimir Putin chaired a meeting to discuss the domestic fuel market, during which he called for minimizing the consequences of attacks on infrastructure and ensuring a stable fuel supply. Russia's biggest refineries are operating at maximum capacity, and small and medium-sized facilities are also used, Putin said at the meeting. He added that repairs are being expedited and that planned maintenance has been deferred. He said July output of the main types of fuel should exceed June.

In a separate interview, Putin admitted that attacks on energy infrastructure "are creating problems, that's obvious," adding that repairs should be completed quickly, the sites should be reliably protected and that imports should be arranged. He also said that the shortages were not critical.

Russian authorities have not yet decided on a diesel export ban, Deputy Prime Minister Alexander Novak told journalists June 29, Interfax reported.