SHANGHAI, Apr 23 (SMM) - Russian diesel exports hit a record high in March despite U.S. and European sanctions on Russian energy supplies, according to data from Kpler.
Since the outbreak of the Russia-Ukraine conflict, the United States, Europe and other Western countries have imposed a series of sanctions on Russia. Following the ban on imports of seaborne crude oil from Russia in December last year, the EU banned the import of refined fuels, including diesel, from Russia in February.
Still, Russia's oil and diesel exports have remained high. Russian crude oil exports have climbed back above pre-Russia-Ukraine conflict levels, driven by countries such as India, while diesel exports hit a record 1.27 million bpd in March, Kpler data showed.
Matt Smith, chief oil analyst at Kpler, said that while Russia's crude oil exports were largely concentrated in a small number of big buyers, as opposed to diesel exports.
He noted that Russian diesel has been flocking to many North African countries, while even other major diesel exporters such as Turkey and Saudi Arabia have increasingly imported Russian diesel in recent months, lured by low prices.
US market share eroded
Some countries, including India, have been increasing imports of Russian fuel for resale, Smith noted.
Brazil, for example, imported virtually zero diesel from Russia until the end of 2022, with most of its supply coming from the U.S. and other sellers, according to Kpler.
In December 2022, the U.S. shipped about 150,000 barrels of diesel per day to Brazil, but this April, that number dropped by about 50%
Meanwhile, Brazil's diesel imports from Russia have soared to nearly 100,000 barrels per day. This shows that despite the greater distance between Brazil and Russia (compared to the United States), the extremely low price of Russian diesel makes it more cost-efficient for Brazil to buy from Russia.
"Russian diesel does seem to be eating into U.S. market share in Brazil."Smith said.
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