Russian Oil Exports Have Stabilized
Russia’s oil shipments appear to have stabilized, with a stable level of 500,000 barrels per day below the peak attained before the February invasion of Ukraine.
In the week ending July 29th, Russian seaborne crude exports hit 3.5 million BPD. Meanwhile, the four-week average is around 3.2 million BPD-a, indicating stabilization.
Russia’s petroleum supplies to Asia have remained constant since the invasion. Russian oil flows to Asia in April and May reached 2.1 million BPD. Still, July figures show this leveled at 1.75 million BPD.
Russia’s oil shipments appear to have stabilized. It is at level of 500,000 barrels per day below the peak attained before the February invasion of Ukraine.
Oil Major BP Boosts Dividend
B.P. raised its dividend and increased share buybacks on Tuesday after tripling second-quarter profits due to strong refining margins and trade.
The British energy company reported an $8.5 billion second-quarter replacement cost profit, which is a proxy for net profit.
It compares to a $6.2 billion profit in the first three months of the year and a $2.8 billion profit in the second quarter of 2021. Analysts predicted B.P. to earn $6.3 billion in the first quarter.
B.P. also increased its quarterly dividend payout to shareholders by 10%, boosting it to 6.006 cents per ordinary share.
B.P. shares surged 4% in early trade in London, hovering towards the top of the pan-European Stoxx 600.
B.P.’s statistics highlight the sharp difference between Big Oil’s profit bonanza and those facing a rising cost of living crisis.
Following a jump in commodity prices caused by Russia’s invasion of Ukraine, major oil and gas companies have shattered profit records in recent months. The immediate aim for many fossil fuel companies appears to be returning funds to shareholders through share buyback plans.
B.P.’s U.K. rival Shell announced a $6 billion share repurchase scheme last week. At the same time, British Gas owner Centrica reintroduced its dividend after a significant surge in first-half profits.
Burning fossil fuels such as oil and gas is the primary cause of climate catastrophe. Experts have discovered that fossil fuel production is “dangerously out of sync” with global climate targets.
In a June speech, United Nations Secretary-General Antonio Guterres called for an end to fossil fuel financing. He called it an additional investment for fossil fuel exploration “delusory.”
How Is Russian Oil Making Its Way from Europe to Asia?
Russia has increased its oil exports to Asia since its invasion of Ukraine resulted in Western restrictions on Russian oil imports. Some crude products destined for Asia are transported from one vessel to another in international European waterways, including those beyond the U.K.’s territorial waters. In May, at least two ship-to-ship transfers occurred off the coast of Suffolk in U.K. territorial waters. UK-crewed boats assisted in the transfer and supplied supplies to the tankers.
Russia is also shifting its residual fuel oil (RFO) exports, which are the world’s largest, away from the West and toward Asia, Africa, and the Middle East.
Russia’s shifting flows are generating new transshipments centers for Russian RFO. These include offshore Kalamata, Greece, where ship-to-ship transfers have increased, and Egypt, where imports of Russian fuel oil reached a record 70kbd in June. As a result, Egypt’s fuel oil exports increased to a 10-month high of 120kbd in June, primarily to Saudi Arabia,” Khasawneh stated in a July research.
European vessel owners, particularly private Greek operators, are transporting a significant amount of Russian oil in the months before the E.U. ban on seaborne Russian oil imports takes effect. Greek tanker owners have boosted their exposure to Russian oil shipping in recent months. Meantime they race to capitalize on China and India’s rising demand for drastically discounted Russian oil.
Russian crude and product exports have yet to be significantly impacted. Despite slightly reduced volumes, Putin is making more money from oil this year than he did before the war in Ukraine or last year, as oil prices remain high.
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