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Russian oil supplies through the Red Sea face fewer risks than competitors - Reuters

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Tankers carrying Russian oil continue to sail through the Red Sea, with little to no interruption due to Houthi attacks on shipping, and face fewer risks than competitors, Reuters reports, citing shipping company executives, analysts and shipping data, UNN writes.

Details

As indicated, russia became more dependent on trade through the Suez Canal and the red sea after the invasion of Ukraine, which led Europe to impose sanctions on Russian imports and forced moscow to export most of its oil to china and India. Before the war, Russia exported more to Europe.

According to the oil analytics company Vortexa, the number of Russian ships passing through the Red Sea has slightly decreased since December, but last week's traffic was still about 20% higher than the average for 2023.

"This contrasted with wider disruptions to oil tanker operations in the Red Sea over the past two weeks," the newspaper writes.

He notes that the supply of diesel fuel and jet fuel from the Middle East and Asia to Europe, one of the main routes for oil trade from East to West, virtually stopped a few days after the first series of US-led retaliatory strikes on Yemen on January 11, as evidenced by Vortexa data.

"Russia has close ties with Iran, which supports the Houthis, and this may have helped prevent the attacks," the article says.

The ships carrying Russian oil are said to have no ties to Israel, the United States, or the United Kingdom. The Houthis have stated that they are attacking ships linked to these countries to demonstrate solidarity with Palestinians in the Gaza Strip.

The G7 sanctions on oil trade with Russia over the war in Ukraine have contributed to the rapid growth of a "shadow fleet" of ships carrying sanctioned oil and fuel. These vessels are leased by companies that are usually registered outside the countries that have imposed sanctions on Russia. They also use maritime services and insurance from countries that do not impose sanctions.

Since these vessels have fewer obvious ties to Western companies, they are less likely to be targeted, the publication notes.

"Most of Russia's crude oil and fuel is transported by the shadow fleet, so it is unlikely that it will be targeted by Houthi attacks," said Adi Imsirovic, an experienced oil trader.

According to Vortexa analyst Mary Melton, many vessels carrying Russian cargo report that they are not tied to Israel because of signals from automatic identification systems (AIS), which publicly transmit information including the vessel's location and destination.

Russia, a partner of key Arab states such as Saudi Arabia and the United Arab Emirates, as well as its ties to Iran, condemned what it called "irresponsible" strikes.

Chinese officials have been pressuring Iran to stop attacks on ships in the Red Sea and to ensure that the attacks do not harm Chinese interests, Iranian sources and a diplomat said last week.

According to Vortexa's Melton, the Houthi attack late last week on a tanker carrying fuel that was originally loaded in Russia is unlikely to affect broader Russian trade flows, as the vessel targeted was a particular one with ties to British and American companies.

Bloomberg: У Червоному морі внаслідок ракетної атаки хуситів загорівся нафтовий танкер з російським паливом27.01.24, 00:29

"The tanker was connected to corporate structures in both the US and the UK, so other vessels carrying Russian cargo without these connections do not face a similar risk," she said.

According to another tracking company, Kpler, the attacked Marlin Luanda tanker belongs to Oceonix Services, a company registered in the UK with an address in London.

Global commodities trader Trafigura, which owned the cargo, said it assessed security risks for further voyages across the Red Sea.

Four tankers carrying Russian Urals crude oil have passed through the Bab el-Mandab Strait, and three more have headed south through the Red Sea following the attack on the Trafigura on January 26, according to Kpler data.

However, western tankers are likely to change their route away from the Red Sea and sail around the Cape of Good Hope, said Shefali Shokin, a leading shipping analyst at a Dubai-based shipowner.

In any case, shippers face higher costs. In the Red Sea, shipowners are charging higher freight rates and crew fees, and insurance premiums for war risks have risen sharply, the publication notes.

ЄС планує розпочати місію в Червоному морі для захисту суден від атак хуситів 01.02.24, 00:05

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