China and India Lead Russian Seaborne Fuel Oil, VGO Purchases in February: LSEG Data

By siliconindia  |  Friday, 12 April 2024, 09:33:46 AM IST

China and India Lead Russian Seaborne Fuel Oil, VGO Purchases in February: LSEG Data
In February, China and India continued to lead as primary destinations for Russian seaborne fuel oil and vacuum gasoil (VGO) exports, a trend spurred by their ongoing efforts to partially substitute crude oil, as indicated by traders and data from LSEG.
Following the European Union's comprehensive embargo on Russian oil products implemented in February 2023, Russia redirected the bulk of its fuel oil and VGO exports to other regions, particularly Asia.
Notably, direct shipments of fuel oil and VGO from Russian ports to India surged to 0.7 million metric tons in February, up from 0.46 million tons in January, based on Reuters calculations and LSEG data.
China received 0.7 million tons of fuel supplies from Russian ports in February, while Singapore and Malaysia received 0.63 million tons and around 120,000 tons, respectively.
India and China typically procure straight-run fuel oil and VGO for refining, often as a cost-effective alternative to Urals barrels, according to industry insiders.
However, a significant portion of Russian fuel oil and VGO was directed for ship-to-ship (STS) loadings near Greece's Kalamata port, totaling nearly 0.7 million tons, with most of these shipments ultimately destined for Asia.
In contrast, export shipments of dirty oil products from Russian ports to Turkey dipped in February to approximately 215,000 tons from 340,000 tons the previous month.
Furthermore, Russia notably increased its fuel exports to Senegal in response to heightened bunker demand, with more companies opting for routes around Africa instead of utilizing Red Sea routes. February saw fuel oil shipments from Russian ports to Senegal reaching 187,300 tons.
Overall, Russian fuel oil and VGO seaborne exports witnessed a 9% month-on-month increase in February, totaling 3.76 million tons, as per LSEG data.
This data underscores the continued significance of China and India as key markets for Russian fuel exports, alongside notable shifts in trade patterns influenced by geopolitical developments and evolving industry dynamics.

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