A Maltese-flagged tanker left the Russian port of Taman, in the region of Krasnodar, on the Black Sea on February 22. Loaded with Russian oil, the balla anchored on April 2 at 6:40 p.m. in the bay of the United States Port of San Diego, according to data from the site marinetraffic.com† Conversely, still in US waters, on the East Coast, another tanker, the Vinjeracunder the Croatian flag, docked on April 4 at the Gulfport Reach Arthur Kil, in New York’s Port Elizabeth, after a journey of 26 days and 18 hours from the Russian port of Ust-Luga, in the Saint Petersburg region. the Baltic Sea.
According to data from marinetraffic.com, at least seven tankers from Russia are still sailing to the United States. These maritime flows illustrate the survival of the exchange of hydrocarbons between Russia and the United States, despite the embargo announced nearly a month ago. Since the President of the United States Joe Biden signed on March 8 the decree forbidding, among other things, the import of Russian oil, deliveries did not stop. If they were 148,000 barrels per day (b/d) in the week (Friday to Friday) ending March 4, they fell to 38,000 b/d the following week – i.e. after the signing of the decree – and then rose to 70,000 bpd in the week of March 18, to ramp up to 100,000 bpd in the week of March 25, according to the latest official data from the US Energy Information Agency (EIA).
Anger from American dockers
Why ? Because the decision provides that the purchases that have already been the subject of a contract (signed before March 8). † And for existing contracts we have a settlement period of 45 days”, the White House had given up. This time limit is in fact granted to take into account the transport time by tanker of the purchased volumes, which can take several weeks depending on the port of departure. If the embargo is respected, Russian oil will no longer be allowed to arrive in American ports from Saturday April 23.
However, this continuation of Russian oil purchases is the subject protests of associations but also of the powerful union “the international longshore and warehouse union”, whose branch of dock workers refuses to work on behalf of ships from Russia. And with good reason, on March 8 a senior White House official refers to an embargo with immediate effect. “The ban is effective immediately. We are blocking any new purchase of Russian energy” (besides oil, it concerns coal and LNG), he stated.
However, as US sanctions tighten and the delivery deadline imposed by the decree approaches, uncertainty over Russian oil deliveries is growing. More than 20 tankers that have left Russian ports since the invasion — along with nearly 8.5 million barrels of oil — are now showing their status as ‘For Orders’ or ‘Drifting’, indicating a lack of destination, the Russian Tanker said. Tracking Group, an initiative led by the Ukrainian government to monitor Russian oil sales.
Thereby, as the story goes New York Times yesterday, the ship Beijing Spirit, which was due to dock in Philadelphia, apparently lost the buyer of its oil and changed its destination to “for order”, indicating that the oil on board is for sale. The tanker then returned to Europe before bouncing around the Mediterranean for several days.
Reorganization of the US Refining Industry
This period of continued Russian oil imports will also be conducive to the reorganization of the US refining sector to find alternatives. Because if the United States is much less dependent on Russian oil than European countries, then this import is far from negligible.
In 2021, Russia’s share of oil imports from the United States was 8%. In detail, this was broken down into 3% of crude oil imports and 20% of petroleum products. Indeed, more than half of these Russian imports are intermediate petroleum products (see chart below)†
Indeed, the dispersion of the refining industry in the United States, concentrated on the US coasts of the Gulf of Mexico, makes it more profitable to import specific products on the west coast of the country than a more limited refining on the east coast. Depending on the type of “raw” being imported, the sulfur content varies and requires different operations of: crack to obtain the products to be consumed: petrol, kerosene, diesel, diesel…
Because Uncle Sam is still very addicted to black gold, even though he has become the world’s largest producer. Last January, the United States produced 17.6 million barrels per day (mbd) but consumed 24.82 mbd, according to data from the International Energy Agency (IEA).
Diversification of Supply Sources
Joe Biden has just asked Canada, the largest crude oil supplier to the United States before Mexico, and to a lesser extent Saudi Arabia and Colombia (Russia ranked 8th so far), to increase production. Last week, the US president also authorized the use of 568 million barrels of strategic reserves at a rate of 1 mbd over a 6-month period, i.e. the equivalent of 180 million barrels, with the aim of lowering pump prices and to moderate inflation. 40 years high.
The United States could also turn to other countries such as India for supplies. As its oil production remains modest (about 770,000 b/d) to meet its needs, India takes a large share of Russia’s supplies. According to one observer, oil swaps – a contract that provides for the exchange of a variable price for a fixed price that relates to a volume of defined products – have risen sharply since the announcement of the US embargo. For example, Russian oil delivered to India could be resold to other countries, this time from the intermediate country and not marked with the country of origin.
