Russia Turns to India for Gasoline as Ukraine Pummels Refineries
Russia has started importing gasoline from India, marking the first time Moscow has imported motor fuel from the South Asian nation, according to Kpler data. The move is a response to severe local shortages triggered by Ukrainian attacks on Russian refineries.
Desperate Measures: Russia’s Gasoline Shortages Worsen
The crisis has been building for months, with Ukraine’s assault on Russian refineries intensifying in recent weeks. As a result, Russia‘s crude-processing rates have plummeted to 3.6 million barrels per day in July, about a third below the seasonal norm. The situation is dire, with Moscow forced to prioritize local users and ban both gasoline and diesel exports.
India Emerges as Unlikely Savior
In this context, Russia has turned to Indian processor Nayara Energy Ltd., backed by Rosneft PJSC, Russia’s top oil producer. Nayara has been relying on so-called dark-fleet tankers and transshipment operations to receive its crude and export fuels. The company’s 400,000 barrel-a-day refinery at Vadinar on India‘s west coast also needs to widen its export market.
Unconventional Shipping: Russian-Linked Tankers Play Key Role
The first shipment of Indian gasoline arrived in Russia on August 5, with more expected to follow. The fuel is being moved on a chain of Russian-linked tankers via transfers off Egypt. According to ship-tracking data compiled by Bloomberg, the Russian-flagged products tanker Cyclone (formerly Agni) loaded a 42,000-ton gasoline cargo from Vadinar on June 18 and transferred it to the Oman-flagged Garnet at Damietta Port, off Egypt’s Mediterranean coast, on July 6. That vessel then reached Russia in early August.
Expert Analysis: Severity of Gasoline Imbalance Revealed
“The emergence of Indian barrels is particularly notable,” said Sumit Ritolia, lead analyst at Kpler. The cargoes complement continued imports from Belarus and other neighboring markets, highlighting “the severity of the current domestic gasoline imbalance, and the extent to which lower refinery runs are reshaping Russia‘s traditional product trade flows.”
Original Article: Russia Turns to India for Gasoline as Ukraine Pummels Refineries | Financial Post — Financialpost