Due to the potential consequences of financial sanctions, fewer shipowners are willing to let their tankers for loading to Russia, so the supply of Russian oil to China is increasingly being transshipped at sea, despite the short distance between the countries.
Bloomberg writes about this with reference to market participants.
The logistically risky and costly movement of oil between tankers at sea highlights the steps that at least one Chinese buyer is willing to take to ensure the smooth flow of oil from eastern Russia to Asia.
The scheme with reloading at sea allows you to increase the number of flights with those ships that are available,” the agency writes.
According to Bloomberg, small vessels are used to transfer between the Russian port of Kozkino and the waters near the port of Yeosu in South Korea, where oil is pumped onto supertankers for the next stage of the transfer to China.
“While this increases the overall delivery time and costs, brokers say this practice is becoming more common as shipowners and buyers prefer such delivery by small vessels to transport oil from Kozmino in a short time: the shorter the flights, the more often you can load available tankers,” the publication explains.
At the same time, as the agency adds, there are no problems with VLCC-type supertankers, which are loaded with oil at sea, due to the COVID outbreak in China and the reduction in demand for them.
According to the publication, at least two Chinese companies are involved in such a scheme with reloading oil at sea – the shipowner Cosco Shipping and the trader Unipec.
China is stepping up its purchases of oil from Russia at bargain prices, filling the vacuum left by Western buyers who are pulling out of business with Russia after its invasion of Ukraine.
China is negotiating with the Russian Federation to purchase additional volumes of oil to replenish its strategic reserves.