Shell and Maersk Tankers still shipping Russia cargoes
Oil traders, charterers and shipowners face difficulties winding down their exposure to Russian energy commodities
Oil major is sending Ust-Luga cargo to Rotterdam while Maersk Tankers says it is fulfilling existing contracts made before it announced ban on new Russia business
The cargo was loaded on Alkinoos (IMO: 9792864) on March 12, four days after Shell said it would end spot purchases of Russian crude and begin a “phased withdrawal” from Russian crude, products, pipeline gas and liquefied natural gas.
It is one of around 20 tankers tracked loading Russian cargoes since March 12, highlighting the difficulties oil traders, charterers and shipowners have in winding down exposure to Russian energy commodities shipped from Baltic and Black Sea ports.
Maersk Tankers, whose parent company has already signalled its divestment in Russian projects, is loading a cargo on Maersk Belfast (IMO: 9299446), which berthed at the port of Novorossiysk on March 13.
The cargo on Alkinoos was bought before Shell’s controversial purchase of a Russian crude cargo from Trafigura. That triggered the company’s ban on further purchases, announced on March 8.
Shell was subject to widespread public criticism for the trading division’s spot market purchase at a deeply discounted price, even as rivals shunned the offer.
“We have stopped buying Russian spot crude cargoes,” a Shell spokesperson said in a statement. “We believe that processing those that we bought earlier can help ensure continuity of fuel supply while we work on ways to eliminate Russian crude from our supply chains.”
Seaborne flows of crude and products from Russia are shrinking as companies self-sanction to avoid reputational risk and avoid exposure to a rapidly changing network of restrictions on Russian energy commodities from countries including the US and the UK, and in Europe.
About 1.5m barrels per day have been removed from the approximately 5m bpd of crude and products seaborne shipments, according to various reports on trade flows.
Maersk Tankers’ parent company AP Moller Holding also owns AP Moller-Maersk, which operates Maersk Line, the world’s second-largest container line.
AP Moller-Maersk joined many European companies in cutting its Russian exposure and said last week that would divest its minority stake in a Russian port operator.
“On February 24, we took the decision not to enter new business in Russia,” Maersk Tanker told Lloyd’s List in a statement. “This means that we will not facilitate new fixtures involving Russian cargoes or companies and we have communicated this to our partners and customers.
“We do have a number of existing contracts for shipments routed through Russian ports that we entered before February 24. This includes a contract involving Maersk Belfast. We are in close contact with our partners and customers and are taking steps to wind them down as soon as possible.”
Chartering premiums for Russia-connected cargo continue to soar as Nato warned of dangers in the Black Sea.
Aframax rates for Baltic-northwest Europe voyages exceeded $266,000 per day, according to the Baltic Exchange. Suezmax Black Sea-Mediterranean cargoes remained at more than $117,000 daily.
“The risk of GPS jamming, AIS spoofing, communications jamming, electronic interference and cyber attacks in the area are considered high,” it said. “Harassment and diversion of shipping in the area cannot be excluded.”
Eight tankers loaded at Novorossiysk, one of Russia’s biggest oil export ports, between March 11 and 14, Lloyd’s List Intelligence data show.
Oil traders Trafigura, Vitol and Glencore subsidiary ST Shipping are among charterers of tankers listed in shipping fixtures scheduled to load refined products across Arctic, Baltic and Black Sea ports in Russia for the week ending March 18, Lloyd’s List analysis shows.
The port of Novorossiysk also ships crude from the Caspian Pipeline Consortium pipeline, which connects Kazakhstan oil to export markets.
Stakeholders include Russia’s Transneft and other European oil companies via Rosneft-Shell Caspian Ventures (7.5%), ENI International and Mobil Caspian Pipeline Co, according to the CPC’s website.
Buyers are reluctant to commit to Russian crude with letters of credit difficult to obtain and shipowners unwilling to load in Russia, said Braemar ACM in a weekly report on the tanker sector.
This risk related to crude and refined product imports is also affecting tanker markets, according to Braemar ACM.
A US ban comes into effect in April, while the UK has given buyers until the end of 2022 to wind down imports.
The European Union has also passed a resolution stating it is looking to cut imports by two thirds by the end of the year.
“If restrictions on Russian exports are formalised, and especially if European countries (Russia’s main customers) join in the sanctions, the situation will change,” Braemar ACM said. “In the short term, we could see shortages develop, necessitating more strategic petroleum releases, unless Iranian sanctions are lifted, or Opec changes its policy and decides to increase output to compensate for the Russian shortfall.
“Until the situation settles, freight rates will remain volatile and elevated.”