Russian oil deliveries to Europe fell by 41%

The war for oil market of Europe, broke out after Russia’s withdrawal from the Union of OPEC+ in March, it seems, ends in favor of Saudi Arabia.

Поставки российской нефти в Европу рухнули на 41%

Offering double-digit discounts and investing $ 1 billion in the purchase of shares of energy companies, the EU, government of the Kingdom of Saudi Agama were able to oust the Russian suppliers on the market, where they held sway for decades.

The largest European neftepererabotki, including British Shell, French Total, Austrian OMV and Spanish Repsol and Cepsa, to dramatically increase purchases of Saudi oil at a price of 10.25 dollar Brent, data from Argus.

Delivery Saudi Agama through the port of Rotterdam, one of the biggest oil hubs in the North-West of Europe, from the beginning of April has reached 1.42 million tons and more than double the levels of March.

Supplies of Russian Urals, by contrast, fell by 41%, to 935 thousand tons. Poland is almost completely abandoned the Maritime supply of raw materials from Russia. Only one party size of 66.5 million tons arrived in the port of Gdansk in April, which is almost 6 times lower than the March purchases ($377 thousand tons).

The supply of Saudi oil to Poland grew by a quarter — from 398 to 500 thousand tons. The bulk of Russian oil, Poland continues to receive long-term contracts built in the 1960s through the oil pipeline “Friendship”, reminds Argus. It provides about 20% of Russian oil exports, or 1 million barrels per day.

But as demand decreases, competition between suppliers intensifies, said Reuters the representative of the European company, processing oil. In mid-April, Saudi Aramco suggested that those suffering from losses to processors in Europe a delay of payments up to 90 days.

“Saudi Arabia is struggling to “handle” the buyer. Probably Russia also needs to think about some special offers,” — said the source Reuters.

According Refinitiv Eikon, the total supply of Saudi oil to Europe in April will be 29 million barrels and will record from August 2016. In may, the European refineries will continue its active purchases from Saudi Agama, predicts Argus: despite the OPEC agreement+ on the reduction of production at 9.7 million barrels per day, Riyadh refused to cancel their varieties and even increased them for customers in the Mediterranean.

Discount on grade Arab Extra Light for southern European has almost doubled — from 5.8 to 10.3 per dollar to the price of Brent. Discounts on Arab Light will rise from 8.6 to 10.3 per barrel on heavy grades of up to 11.4 per dollar. For North-Western Europe will remain in force discount 10.25 dollar on the Arab Light, price of ultralight oil Arab Extra Light will be reduced by 80 cents to minus 8.9 per us dollar to Brent.

“Saudi oil captured a huge share of the European market”, — says senior analyst of “Alfa-Bank” Nikita Blokhin.