The data released by the London Stock Exchange on Friday (August 16) showed that in July, most of the fuel oil and vacuum gas oil (VGO) exported by Russia via sea was shipped to China and Saudi Arabia. These two countries have become the largest importers of Russian seaborne fuel oil.
Reuters reported on Friday that traders’ data also confirmed this news. According to Reuters, Russia’s seaborne exports of fuel oil and vacuum gas oil in July increased by 7% compared to June, reaching around 4.05 million tons. It is said that the completion of seasonal maintenance at Russian refineries contributed to the increase in fuel oil and vacuum gas oil exports.
According to Reuters’ calculations based on industry sources, Russia’s offline primary refining capacity in July was 2.5 million tons, approximately 44% lower than June’s level. Last month, the total export volume of oil products from the Baltic ports of Primorsk, Vysotsk, St. Petersburg, and Ust-Luga decreased by 4.6% to 5.034 million tons. However, fuel exports from Russian Black Sea and Azov Sea ports increased by 17.5% compared to June, reaching 3.585 million tons.
Since the European Union’s comprehensive embargo on Russian oil products took effect in February 2023, Asian countries have remained the primary destinations for Russia’s fuel oil and vacuum gas oil exports. According to official Chinese data, in 2023, Russia surpassed Saudi Arabia to become China’s largest crude oil supplier. Last year, Russia supplied a total of 107 million tons of crude oil to China, equivalent to providing China with 2.14 million barrels of crude oil per day, significantly surpassing the export volumes of traditional oil-exporting giants such as Saudi Arabia and Iraq to China.
In July, Russia’s direct shipments of fuel oil and vacuum gas oil to China from its ports increased by 18% month-on-month to 700,000 tons.
Market sources said China imports straight-run fuel oil and vacuum gas oil as refining feedstock and also imports Ural crude oil.
Both Reuters’ calculations and London Stock Exchange Group data showed that Saudi Arabia’s loading volume nearly doubled compared to June, reaching 700,000 tons, most of which was shipped to power plants during the peak summer electricity demand period.
In July, Russia’s fuel oil and vacuum gas oil supplies to India decreased by 7% to 480,000 tons, while the transportation of lower-purity “dirty oil” products to Fujairah, Saudi Arabia, increased from 200,000 tons to 320,000 tons. Deliveries to Turkey surged from 95,500 tons to 264,000 tons.
Shipping data showed that the volume of fuel oil and vacuum gas oil exported from Russia’s Pacific ports to South Korea increased from 36,200 tons in June to 118,000 tons in July.
Around 295,000 tons of vacuum gas oil and fuel oil loaded at Russian ports in July were transported near Greece and Malta for transshipment. Market sources said that most of the fuel oil ultimately ended up in Asia.