MOSCOW, April 5 (Reuters) - Sibur, the largest producer
and exporter of liquefied petroleum gas (LPG) in Russia,
redirected exports to Africa, the Middle East and Asia in the
past three months, industry sources said.
The European Union imposed an embargo on the import of
petroleum products of Russian origin from Feb. 5, but LPG was
not banned. Many EU buyers, however, cut LPG purchases from
Russia to negate any possible risk.
"Most buyers in Europe abandoned Sibur's LPG, so the
company was forced to look for new distribution channels," one
trader said.
Sibur declined to comment.
The company's deliveries of LPG from Russia's Baltic port of
Ust-Luga to EU countries and the UK in the first quarter of 2023
slid to 14-15% of the total, or 33,000 tonnes, against 82%, or
194,000 tonnes, a year earlier, according to Reuters
calculations based on ship-tracking data.
Its shipments to Africa, the Middle East and Asia-Pacific,
meanwhile, accounted for about 85-86%, or 192,000 tonnes, of
total shipments amounting to 225,000 tonnes.
In the first quarter of last year, countries outside EU and
UK accounted for only 18%, or 43,000 tonnes, of LPG shipped from
Ust-Luga.
Redirecting quite a few of Sibur's LPG cargoes from the
Amsterdam-Rotterdam-Antwerp (ARA) trading hub outside Europe has
significantly increased the round trip for gas carriers,
ship-tracking data shows. To avoid higher freight costs Sibur
and trader Trafigura have engaged larger vessels to ship LPG
outside the EU, three LPG traders told Reuters.
The company has moved its ship-to-ship (STS) loadings from
ports in the ARA region to the Estonian port of Paldiski since
August, ship-tracking data shows.
Sibur LPG cargoes arriving from Ust-Luga are being sold to
Trafigura, which reloads them at Paldiski to MGC (medium gas
carriers, about 22,000 tonnes) or LGC (large gas carriers,
44,000 tonnes) vessels, the LPG traders said.
Asked to comment, Trafigura said it "continues to engage
with customers and governments to understand their requirements
and provide the commodities and energy they need in severely
disrupted commodities markets”.
(Reporting by Reuters
Editing by David Goodman
)
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.