Europe craves Russian oil

Western European oil refineries are going through rough times.

Currently, European refineries experience hardships due to an extremely small portion of raw materials that is being imported from Russian sea ports through Bosporus and Dardanelle channels. According to European business circles, present weather conditions are to blame. Nasty weather in the region disables navigation thus leaving the crew at risk, reports British newspaper “Financial Times.”

Oil refineries of the entire Mediterranean region are experiencing raw material deficit as a result of recent stall in Bosporus and Dardanelle, which is the only route for Russian oil to travel to the Mediterranean. Dealers purchasing oil in Spain, Italy, France, Germany have no other choice but to limit their operations up to 20-25 day delay.

The stall in Bosporus creates a threatening situation, similar to 1991. Back then, average timeframes for oil delivery to Europe had been delayed due to the ongoing Gulf war. Today, Russian companies had to shut down one of their pipeline. It was supposed to transfer oil to the Black sea. Tanker loading is being delayed and all portal storages are already packed.

Turkish authorities have recently banned large tankers from traveling through the channel at night. Europe presumes that this was done purposely in order to expedite the process of construction of additional trans-Caucasian Baku-Jeyhan pipeline.

The situation grows worse because of no oil supply from Iraq. Oil fields in Kirkuka and Mosula regions have been shut down since March of last year out of fear of possible terrorist acts.

Today, oil prices reached a 9-month maximum as a result of ongoing problems in Bosporus. One barrel of “Brent” gasoline costs $31.65 on London’s stock market. In New York, “Texaco” is priced at $34,70 (since Spring of 2003). Current oil price exceeds last year’s indicator by 7.3%.

Oil becomes more expensive as a result of long expectations of sudden cooling in North America as well as the overall fuel reduction in the US. According to the Department of Energy of the US, weekly oil reserves which elapsed on January 2, have decreased by 1.7 million barrels-up until 269 barrels, which is the lowest indicator in 28 years.    

Source: Financial Izvestia