Russian Terminals in the Baltic Unable to Accept Fuel for Export for Second Week - Reuters

According to reports from traders published by Reuters, Russian refineries have been unable to deliver diesel fuel to the Primorsk port for export since March 22, 2023. This situation has created considerable challenges for factories located in the European part of Russia, as they lose one of their most profitable export routes.

One industry source confirmed this information, stating, "Diesel fuel has not been accepted in Primorsk since Sunday (March 22 - ed.)." This indicates serious problems arising from export restrictions and disruptions at major oil refineries.

Meanwhile, refineries that typically send fuel to Ust-Luga have been considering redirecting shipments of fuel oil to Vysotsk, located further north in the Gulf of Finland, or to Tamani on the Black Sea coast over the past week and a half. However, traders noted that Vysotsk has lower capacity, and sending shipments to Tamani requires a greater number of rail wagons, further complicating the situation.

Experts point out that these export restrictions, along with the operational issues of large refineries, may lead to a reduction in oil production in Russia, which, in turn, would have negative consequences for the country's economy. This week, representatives of Finnish maritime authorities also reported to Reuters that the volumes of shipments from Primorsk and Ust-Luga have sharply decreased to "individual vessels," marking a significant decline compared to the mid-week average of 40-50 vessels.

Additionally, it is worth noting that drone attacks on the port in Ust-Luga, which have occurred over the past two weeks of March, have severely damaged port infrastructure. This has led to a suspension of cargo handling capabilities, with at least five strikes recorded at the facility over a span of ten days.

Regarding the Russian oil refinery Kirishinefteorgsintez (KINEF), located in the city of Kirishi, it has also suffered from drone attacks. Preliminary estimates suggest that the refinery may partially restore its production within a month, but this will depend on how quickly Russian ports can resume the unloading of oil products.

This situation raises concerns among analysts and traders, as it could significantly impact the petroleum market in the region. In the context of increasing competition and export restrictions, Russian companies may face new challenges in ensuring the stability of their supplies.

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