Russian Oil Stranded Off South Korean Coast Due To US Sanctions And Payment Issues

Russian Oil Stranded Off South Korean Coast Due To US Sanctions And Payment Issues - Merchant Navy Info

More than a dozen tankers carrying about 10 million barrels of Russian Sokol crude oil. Have been stranded off the coast of South Korea for several weeks. And have not yet been sold due to existing U.S. Sanctions and payment difficulties, two traders said. This amount is equivalent to 1.3 million tons, which is more than the monthly output of the Sakhalin 1 project. Was once the mainstay of U.S. giant Exxon Mobil,  which was withdrawn from Russia after Moscow’s invasion of Ukraine. Sakhalin 1 was one of the first contracts concluded under a production-sharing agreement in post-Soviet Russia.

When ExxonMobil withdrew in 2022, production fell to almost zero and has not yet fully recovered. Difficulties selling Sokol crude are one of the biggest challenges. Facing Moscow since Western countries imposed sanctions. Making it one of the most severe disruptions to Russian oil exports in the past two years. 

The U.S. government says the sanctions are aimed at reducing the income of President Vladimir Putin. And his military establishment based in Ukraine. But are also aimed at significantly disrupting the flow of Russian energy to global markets. He said that it was not intended as such. Last year, the United States imposed sanctions on a number of ships and companies involved in transporting Sokol.

Oil Tankers 

According to LSEG, Kepler data, and information, traders, as of Friday. 14 ships carrying Sokol were stranded at Jo’s port, including large crude oil tankers (abbreviated as VLCCs). ) and 11 Aframax ships. The amount stored in the tanker is equivalent to 45 days of Sakhalin. 1’s production or an average of 220,000 barrels per day. The approximately 3.2 million barrel supertanker (VLCC) Nireta, La Barena, and Nellis,  currently located near Yeosu, South Korea, is functioning as a floating storage facility for  Russian tankers, Reuters sources said, as well as shipments of Kupler and LSEG.

The data reflects that  VLCCs previously received oil from many Aframax vessels on a ship-to-ship basis. Shipping large quantities of oil from smaller ships to larger ships saves on freight costs. The rest of the Sokol oil to be loaded after January and November will be from  Krymsk, Sakhalin Island, NS Commander, NS Century, Pavel Chernysh, NS Lion, Riteini Prospekt, NS Antarktic, Vostochny Prospekt, Viktor Titov. It will be stored on Jaguar’s small Aframax ship.

Sokol deliveries to  Indian Oil Corporation (IOC.NS) have been delayed due to payment issues, forcing India’s biggest refiner to reduce inventories and buy more crude from the Middle East. A source close to  IOC said the company does not expect to receive any shipments of Sokol right away because of disagreements over which currency to pay for the shipments. IOC is the only state-owned refiner with an annual contract to buy various Russian grades, including Sokol, from Russian oil giant Rosneft.

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