Oil Loadings from Black Sea Ports Remain Suspended
Oil loadings from the Black Sea port of Novorossiysk and the Caspian Pipeline Consortium (CPC) terminal have not resumed due to an ongoing storm forcing exporters to look for alternative routes, three sources familiar with exports told Reuters on Wednesday.
Novorossiysk and the CPC terminal account for about 2 million barrels of oil per day (bpd) from Russia and Kazakhstan.
"A storm warning is in effect in Novorossiysk. It is raining, and the wave height is from two to four meters," said a source at the port, adding that the situation at the CPC terminal sitting some 15 kilometres west of Novorossiysk is similar.
The delay in oil exports from Novorossiysk for November exceeded 1 million metric tons as of Wednesday, one of the sources said. The initial export plan was 2.42 million tons.
Russian and Kazakh producers are seeking to redirect oil flows to other destinations, in particular to Russia's Baltic ports, but such opportunities are limited due to high demand.
One of the sources in a company involved in CPC Blend oil loadings said that all possible alternative export options had been studied, but the issue was so sudden it was really difficult to divert volumes.
Russian oil exporters plan to cut supplies to Novorossiysk in December as a large volume of shipments is expected to be postponed for loadings slowing exports for the next month.
Oil exporters from Russia and Kazakhstan can also redirect oil volumes from Novorossiysk to Druzhba oil pipeline, a trader involved in Russian oil trading said. However, such supplies might be curbed by export quarterly schedule limits and European refiners' demand.
Kazakhstan supplies oil to Germany. It is expected to ramp up supplies to 150,000 tons in November and 200,000 tons in December from the typical 100,000 tons per month.
Russian companies supply oil to the Czech Republic, Slovakia and Hungary, which received an exception from the EU embargo on Russian oil.
(Reuters - Reporting by Reuters Editing by Matthew Lewis)
