Europe is loading up on Russian oil 3 months before an import ban is set to kick in amid EU's energy crisis
Seaborne Russian crude shipments rose to 3.32 million barrels a day in the week ending September 2, per Bloomberg.
In particular, seaborne Russian crude shipments to Northern Europe jumped 20% on-week.
The increase comes as the EU plans to ban most Russian crude-oil imports from Dec. 5.
The European Union is banning most Russian oil imports from December 5 — but the bloc's still snapping up bumper cargoes of the fuel months ahead of winter amid an energy crisis.
The embargo aimed at punishing Moscow over its invasion of Ukraine is expected to cut around 90% of Russian crude imports to the EU. The pending ban covers cargoes transported via ships but does not include oil transported via pipelines.
Europe imported about 1 million barrels a day in the week ending September 2 — marking a four-week high, according to a Bloomberg analysis based on vessel tracking data. This is also up from 890,000 barrels a month ago in August, although it was sharply lower than the post-invasion high of 1.28 million barrels a day in June, according to the data published on Monday.
The EU is expected to slow its purchases of Russian oil at least a month before the December 5 ban to ensure compliance by the deadline, per Bloomberg.
Overall, total seaborne Russian crude shipments rose to 3.32 million barrels a day in the week ending September 2 — up 13% from a week ago, according to Bloomberg's data. Shipments to Northern Europe jumped 20% week-over-week while shipments to Asia remained stable. In particular, shipments to the Netherlands — home to Europe's major Amsterdam-Rotterdam-Antwerp oil refining hub — rose 13% from a week ago, per the report.
This sent the Kremlin's revenue from its crude-export duty up to $167 million in the week to September 2 — 12% higher on-week, according to Bloomberg's calculation based on data from the Russian Finance Ministry and vessel tracking data.
The analysis released by Bloomberg underscores Europe's reliance on Russian energy and the challenges it's facing in weaning off oil and gas from the energy giant. In 2021, Europe snapped up about half of Russia's oil products and three-quarters of its natural gas, according to the US Energy Information Administration.
Europe's oil embargo also comes at a challenging time for the energy market, which was already facing a supply crunch even prior to Russia's invasion of Ukraine earlier this year.
Now, the EU is facing an energy crisis due to Russia shutting down its natural-gas pipeline. Oil supply is also limited.
"Oil markets are tight; they'll remain tight for some time to come. On the supply side, it's a very well-known fact that OPEC cannot produce at its declared volumes, simply because their capacities also are running out," said Ben van Beurden, CEO of energy giant Shell on August 28, as reported by S&P Global.
"We have to see what December 5 will bring, but it looks to be quite a volatile market probably for some time to come," van Beurden told journalists at an industry conference.
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