Europe braces for more cuts in Russian oil and gas exports

An inside view exhibits a brand new pumping station of the Caspian Pipeline Consortium (CPC) close to town of Atyrau, Kazakhstan October 12, 2017. REUTERS/Mariya Gordeyeva

MOSCOW, Aug 22 (Reuters) – Europe faces recent disruption to power provides on account of harm to a pipeline system bringing oil from Kazakhstan via Russia that was reported by the pipeline operator on Monday, including to considerations over a plunge in gasoline provides.

CPC, which handles about 1% of worldwide oil and whose largest shareholder is Russian pipeline agency Transneft, stated exports from two of its three mooring factors at a Black Sea terminal had been suspended, confirming a Reuters report. learn extra

The West accuses Russia of limiting power provides to spice up costs in retaliation for sanctions imposed after Moscow’s invasion of Ukraine, which the Kremlin calls a particular army operation. Russia denies this, blaming Western sanctions themselves and numerous technical issues.

Russian pure gasoline provides to Europe are down round 75% yr on yr, with export firm Gazprom final week asserting unscheduled upkeep on the Nord Stream 1 pipeline, which runs below the Baltic Sea to Germany. learn extra

Pure gasoline costs jumped on Monday, with outages at Norwegian and UK gasoline fields including to considerations.

British gasoline for rapid supply was up 125 pence to 490 pence per therm at 1730 GMT, whereas the day-ahead contract rose 123 pence to 484 p/therm.

Ukraine’s gasoline transmission system operator stated it and the Polish gasoline pipeline system had the capability to convey Russian gasoline to Europe and compensate for the Nord Stream halt. learn extra

Gazprom (GAZP.MM) didn’t reply to a request for touch upon whether or not it might improve gasoline exports through different routes.

CPC (Caspian Pipeline Consortium) stated it needed to droop loadings from its SPM-1 and SPM-2 mooring factors on account of harm at “the attachment factors of underwater sleeves to buoyancy tanks”.

It stated loadings have been solely being processed from SPM-3 and so oil loading requests must be decreased.

Tengizchevroil (TCO), which represents Chevron (CVX.N) and Exxon (XOM.N) in Kazakhstan’s big Tengiz mission, stated it was conscious of short-term upkeep at CPC and its oil exports and output on its Tengiz oilfield have been at the moment uninterrupted. learn extra

TCO has a decrease output plan on its Tengiz oilfield in August-September on account of deliberate upkeep.

“CPC is a key export route for crude oil manufacturing from Kazakhstan to succeed in worldwide markets and lots of nations depend on this essential transportation system for his or her power safety”, – Chevron stated in a press release despatched to Reuters.

TotalEnergies (TTEF.PA), which has a presence in Kazakhstan as nicely, additionally didn’t instantly reply to a request for remark, whereas Shell (SHEL.L) and Eni (ENI.MI), that are shareholders in CPC, declined to remark.

DAMAGED TANKS

CPC stated it deliberate to exchange components on the 2 affected SPMs and was in search of an organisation to hold out the work. The consortium didn’t give a timeline.

Two sources accustomed to the matter informed Reuters that one SPM can deal with lower than 70% of regular terminal capability, leaving Kazakhstan, which makes use of CPC as a essential route for its oil exports, with the prospect of getting to chop output. learn extra

Kazakhstan needed to minimize oil manufacturing within the spring when CPC suspended loadings from two SPMs on account of harm.

CPC has minimize exports on a number of different events over the previous six months.

CPC Mix crude oil exports had been set at 5.026 million tonnes for August. The consortium has not given up to date figures.

It stated earlier this month that provides through its system have been down considerably on account of upkeep at Kazakhstan’s Kashagan and Tengiz initiatives. Decrease output from the oilfields may restrict the disruption from the SPM outages, the 2 sources stated, however added they may develop into a significant situation as output ramps up after the upkeep. learn extra

CPC’s disruptions this yr have led some oil producers to barter different provide routes. learn extra

The primary shareholders in CPC are Transneft (TRNF_p.MM), (24%), Kazakhstan’s KazMunayGas (19%), Chevron Caspian Pipeline Consortium Firm (15%), LUKARCO B.V (12.5%), Mobil Caspian Pipeline Firm (7.5%), Rosneft-Shell Caspian Ventures Restricted (7.5%) and Eni Worldwide (N.A.) N.V. S.ar.l. (2%).

Reporting by Reuters bureaux; further reporting by Shadia Nasralla in London
Modifying by David Goodman, Mark Potter and Philippa Fletcher

: .