According to market data and LSEG on Tuesday, Russian shipping company Sovcomflot began transporting Urals crude to Asia this year via the Northern Sea Route. Melting ice has opened the Arctic transit route to transit shipments.

Russia is looking for alternative routes from western ports to Asia, as Western sanctions are making it more difficult for their fleet to navigate in the waters near European Union countries.

The Northern Sea Route is a challenging route, even though it's shorter than an alternative via the Suez Canal. Icebreakers are needed to assist vessels in passing along the Russian coast.

The oil terminal is usually open from July until October.

It runs about 3,500 miles (5,600 km) from the Port of Murmansk at the border between Russia and Norway to the Bering Strait in Alaska. Scientists have linked the shrinking ice in recent decades to climate change.

Vladimir Putin, the Russian president, has been pushing for the construction of this route in order to pivot Russia towards Asia during the worst crisis of relations between Russia and the West since Cold War times.

LSEG shows that the Aframax Viktor Bakaev vessel, which is operated by Sovcomflot, and sanctioned in the U.S.A., has loaded 100,000 metric tonnes of Urals crude oil in Primorsk and is now in the Barents sea on its way to Asia.

Data shows that two more Sovcomflot Aframax crude ships, Korolev Prospect (also under U.S. sanction) and Vernadsky Prospect are heading west from Russia's Far East via the NSR.

According to two industry sources, these tankers will likely be loading oil at Russia's west ports to supply Asia.

The oil was not known to which Asian port it would go or whether the cargo would be loaded onto other ships in Russia's Far East. Market sources said that the cargoes would likely go to China.

The European Union sanctioned the Russian shipping company Sovcomflot in June after Washington designated 14 of their tankers earlier this year.

Sovcomflot didn't immediately respond to an inquiry for comment.

According to Rosatom, the open registry of Rosatom applications, the demand for shipping via the Arctic route will remain high among Russian oil companies in 2024. At least seven Sovcomflot vessels of 100,000 tonnes have received transit navigation permission along the NSR already this year.

The Russians sent 0.6 millions tons of Urals oil to Asia last year via NSR. The sources expect that this year the oil volume transported through the route will increase significantly.

Rosatom, Russia's state nuclear agency, is also responsible for navigation along the NSR. It provides tankers with icebreakers to help them on their journeys.

In 2022, Russia approved a plan of development that would see cargo volumes increase from 34,000,000 metric tons to 150,000,000 in 2030. The turnover last year exceeded 36,000,000 tons. (Reporting by ; editing by Guy Faulconbridge, Alexandra Hudson)

(source: Reuters)