Page 6 - MEOG Week 10 2022
P. 6
MEOG COMMENTARY MEOG
Asian refiners
consider their options
Asian refiners appear to be looking at limited impact from Russia’s invasion of
Ukraine so far, but are increasingly keen to resume crude imports from Iran.
GLOBAL ASIAN refiners are considering their next steps Asia accounted for nearly 35%.
in the wake of Russia’s invasion of Ukraine. Asia According to the report, Russia’s crude
is not as exposed to Russian crude as Europe, exports to Asia reached 1.44mn bpd in 2021,
WHAT: but still stands to be affected by the conflict as with 805,000 bpd – or 56% – going to China.
Asian refiners are eager oil prices rise and dealing with Russia becomes Reuters had a higher figure, however, saying
to resume crude imports more complicated owing to a growing number of that China’s imports of Russian oil had averaged
from Iran. sanctions against the country. 1.59mn bpd in 2021, accounting for 15.5% of
Against this backdrop, Asian refiners may not its total crude imports. The Reuters figures also
WHY: rush to stop doing business with Russia – and showed that Russia was the fourth-largest sup-
Their exposure to Russian indeed could snap up discounted Russian oil plier of crude to South Korea in 2021, and the
crude is limited, but they cargoes that have been rejected by other buyers. fifth largest seller of oil and gas – in the form of
are affected by rising oil However, they could still start looking for LNG – to Japan.
prices. replacement sources of crude in case those are Regardless of the disparity between the fig-
considered necessary at a later date as the sit- ures being reported by different outlets, this
WHAT NEXT: uation continues to evolve. And resuming oil illustrates that enough Russian oil is sent to Asia
There is also a possibility imports from Iran now looks like an increasingly for it to have an impact if supplies are disrupted.
that Asian refiners could attractive prospect that could help relieve some
snap up discounted of the upward pressure on crude prices. Response
Russian crude rejected Following the Russian invasion of Ukraine, sev-
by others. Impact eral countries were quick to respond with sanc-
Excluding China, Russian oil only accounts tions, including the US, the UK, Australia and
for 1-6% of imports to Asia, according to S&P European Union members. Some Asian coun-
Global Platts. tries were also involved in the initial sanctions.
However, even 1-6% of total imports is not Those initial sanctions targeted Russia’s econ-
an insignificant amount. The Oxford Institute omy but not oil supplies or energy payments.
of Energy Studies (OIES) said in a new report Indeed, the US was quick to note that energy
this week that Russian crude exports averaged payments would not be affected by restriction
4.27mn barrels per day (bpd) in 2021, with on Russia’s access to the SWIFT payment system.
Europe comprising around 60% of this, while However, given that an invasion of Ukraine had
P6 www. NEWSBASE .com Week 10 09•March•2022