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Germany monitoring oil supplies closely as Russian pipeline outage drags on

London — Germany is not planning to tap its strategic oil reserves but is monitoring the local fuel supply situation closely, the country's economy economic and energy ministry said Friday, faced with at least another month without piped Russian crude imports.

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Two German refineries -- PCK's Schwedt and Total's Leuna plants -- lie toward the end of the northern branch of the 1 million b/d Druzhba crude pipeline from Russia, which has been largely shut since April 22 due to a major contamination incident.

Although flows via Belarus have now resumed, Polish pipeline operator PERN said on Thursday that supplies of clean Russian oil on the route could restart June 9 at the earliest. Russian crude flows from eastern Poland are then expected to take another two to three weeks to reach Germany.

"The security of supply in Germany is not affected," a ministry spokeswoman said in an email. "Currently, there are no considerations to tap the oil reserve. Of course, we are watching the situation closely."

Germany's oil stocks administrator, EBV, confirmed Friday it had not received any requests for a release of crude or products.

Germany, Europe's biggest economy and fuel market, last released strategic oil stocks in October when Rhine water levels fell to record lows, blocking barge shipments through the key inland waterway.

The Russian crude supply outage has already forced Poland, Hungary and the Czech Republic to release emergency oil stocks. As the stoppage enters its fifth week, European oil traders have already reported fuel shortages in Germany following reduced crude supply along the Druzhba pipeline.

REDUCED REFINING RUNS Under International Energy Agency and EU rules, member countries must maintain emergency stocks of crude oil and/or oil products equal to at least 90 days of net imports or 61 days of consumption, whichever is higher.

At the end of last year, Germany held a total of 24.06 million mt of state-controlled emergency crude and oil product stocks, equivalent to 100 days of net imports, according to EU stock data.

Of the total, 14.68 million mt was made up of crude and NGL stocks with the remaining 9.38 million mt comprised of products such as gasoline and diesel.

In addition, oil stocks held by German industry stood at around 30 days of net imports in February, according to the IEA.

On Tuesday, Total said its 230,000 b/d Leuna refinery was restarting after an outage but planned to operate the plant at limited capacity due to ongoing supply issues with the Druzhba pipeline. Total said it was using its own crude stored in Germany, adding it was looking to limit the impact on fuels supplies to its customers.

A spokesman for Germany's oil industry association MWV said both the PCK and Leuna refineries are running at reduced capacity levels and are processing crude supplied by tankers to Baltic Sea ports.

The refineries are able to source crude shipped to Germany's Baltic Sea port of Rostock, which is connected to the plants via pipeline. Seaborne crude imports can also be supplied to Germany via Poland's Gdansk port through the northern section of the Druzhba pipeline.

PCK was not available for comment and Total did not respond to requests for comment.

Separately Friday, Czech refiner Unipetrol said it does not plan to request a third loan from state-held oil stocks after country's oil reserves agency said that Russian crude deliveries are now expected to arrive at Unipetrol's Litvinov refinery on May 27.

-- Robert Perkins, robert.perkins@spglobal.com; Chris Johnstone, newsdesk@spglobal.com

-- Edited by James Burgess, newsdesk@spglobal.com