Seaborne Products Exports from Former Soviet Union Remain Flat in 2003

Strategic Insights -

Despite another year of strong crude production growth and increased refinery runs, seaborne product exports from the former Soviet Union (FSU) remained almost steady in 2003, with only 2.8% growth from the previous year. Fuel oil shipments, which had accounted for the majority of product export growth in the previous two years, dropped by 5.3% due to higher rail transport costs and the reluctance of exporters to pay up to $70/ton to transport spot material from Siberian refineries. As a result, shipments of fuel oil abroad during the peak river navigation season also dropped, and Russian exporters sent 5.25 million tons of oil products through St. Petersburg during the river export period, compared to 6.43 million tons in the previous year.

Key Takeaways:

  • Seaborne product exports from the FSU remained flat in 2003, with only 2.8% growth from the previous year to 79.92 million metric tons.
  • Fuel oil shipments dropped by 5.3% in 2003, despite being a major driver of product export growth in the previous two years.
  • The decline in fuel oil shipments is attributed to higher rail transport costs, with exporters reluctant to pay up to $70/ton to transport spot material from Siberian refineries.
  • Shipments of fuel oil abroad during the peak river navigation season dropped due to increased costs and decreased demand.
  • Russian exporters sent 5.25 million tons of oil products through St. Petersburg during the river export period, compared to 6.43 million tons in the previous year.
  • The decrease in river exports was largely due to a 14-day shorter navigation season and the use of more expensive double-hulled tankers for floating storage.
  • The number of floating storage vessels placed outside St. Petersburg decreased, with only five vessels placed, compared to six vessels in the previous year.
  • The players in St. Petersburg's floating storage market included Yukos affiliate Petroval, Swiss-registered Corus, and trader Navitank.
  • Crown Resources, renamed ERC Trading after the Prestige spill, participated in the river season through a ship-to-ship transfer, moving 220,000 tons of fuel oil into eight handy-sized tankers.
  • Exports shipments through the Black Sea's floating storage plunged 39% to 1.43 million tons.
  • Gas oil shipments remained strong in 2003 at 29.56 million tons, growing by 3.7%.

Statistics:

  • Seaborne product exports from FSU remained flat in 2003, with only 2.8% growth from the previous year to 79.92 million metric tons.
  • Fuel oil shipments dropped by 5.3% in 2003 to 5.25 million tons.
  • Shipments of fuel oil abroad during the peak river navigation season dropped by 14.4% to 1.35 million tons.
  • Russian exporters sent 5.25 million tons of oil products through St. Petersburg during the river export period.
  • The number of floating storage vessels placed outside St. Petersburg decreased to five, compared to six vessels in the previous year.
  • Exports shipments through the Black Sea's floating storage plunged 39% to 1.43 million tons.
  • Gas oil shipments grew by 3.7% to 29.56 million tons in 2003.

Sources:

  • NC Nov.20, p7
  • Mike Teagarden, Moscow.