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India's weak demand for Urals oil leads to a widening of discounts on the oil
Sources say that the differentials between Russian Urals crude and other grades are under pressure due to the weakening value of the grade in India's ports. Three sources in the oil trade reported that discounts for Russian Urals crude have tripled in Indian ports since August compared to Brent dated as U.S. sanction drive key buyers from Moscow-supplied fuel. According to traders, the December Urals cargoes are currently trading at a discount of $5-$6 per barrel compared to Brent. This is about three times greater than the $1-2 seen in August. PLATTS WINDOW There were no bids or offers reported on the Platts Window for Urals CPC Blend, or Azeri BTC on Wednesday. Five sources have confirmed that U.S. sanctions will dismantle what is left of Litasco. Litasco was once Russia's largest oil trader, and a competitor to Swiss oil giants and top Swiss houses. (Reporting from ;)
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CMA CGM, the shipping giant, resumes Russia trade by bringing in food cargo
The company, CMA CGM of France, which is the third largest container shipping line in the world, said that it has resumed limited service to Russia. This includes transporting food. It did so three years after the company had withdrawn from Russia following the invasion of Ukraine. CMA CGM, like other Western companies, ceased its activities in Russia. It stopped its shipping services, and divested its stakes in port terminals. CMA CGM stated in an email that the CNC subsidiary of the group has re-launched shipping foodstuffs to Russia, such as coffee and citrus fruits to meet customer demand. It said that the activity was very limited and strictly conducted in compliance with the sanctions regime. The French newspaper Ouest France reported that CMA CGM did not use its own fleet, but booked space on other vessels to transport its containers. CMA CGM has joined its Swiss rival MSC to ship cargo to Russia. MSC continued to ship humanitarian, medical and food items during the conflict in Ukraine.
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Chinese cruise ships avoid Japan amid diplomatic dispute
Sources and cruise schedules reviewed indicate that Chinese cruise operators are avoiding Japanese ports due to a diplomatic dispute between Beijing and Tokyo. This is expected to boost tourism to South Korea. The tensions sparked by the recent events have been cited by tour and port agents. You can also read our blog posts. Japan's new premier could lead to Chinese tourists being redirected from Japan to South Korea. Sanae Takaichi, Japan's new prime minister, told Japanese legislators earlier this month that a Chinese attack against Taiwan could lead to a military response. Adora Magic City is a Chinese cruise liner that visits the touristy island of Jeju in South Korea as well as Japan. According to an announcement posted on the website of South Korea’s Jeju Province, the ship has altered its December schedule to avoid the Japanese ports Fukuoka Sasebo, and Nagasaki, as originally planned. The notice stated that the cruise ship would spend between 31 and 57 hours at Jeju instead of its usual nine-hour schedule. Unofficially, a Jeju official said that the cruise operator asked for a schedule change without giving any reason. The official declined to identify himself as he wasn't authorised to talk to the media. It seems that they are working on a Plan B." Adora Cruises has not responded to a comment request. Japan is counting the costs of the diplomatic conflict. Tokyo-based East Japan International Travel Service said this week that it had lost 80% its bookings for remainder of year. Lee Yong Gun, CEO of South Korean port agent Eastern Shipping told reporters that other Chinese cruise ships were also in discussions to reroute. Lee stated that "if the China-Japan relations further deteriorate and China excludes Japan’s products, culture, and tourism, then I expect Korea to benefit from this." He said that the operator of the "Dream", which departs the Chinese city Tianjin wanted to avoid Japan by rerouting to a South Korean Port in Incheon, or Busan, over the next two weeks, but there wasn't enough time to do so, citing an earlier discussion with the operator. Tianjin Orient International Cruise Line which operates the ship did not reply to a comment request. Details about cruise ships skipping Japan to stay longer in Korea, or even considering it due to diplomatic disputes, have never been reported. According to Qunar, an online travel agency, South Korea was the most popular destination among Chinese tourists in terms of bookings of international flights over the weekend between November 15-16. Many Chinese airlines are offering refunds for routes to Japan. This is expected to increase air travel in South Korea. Jeju Air's executive said that the South Korean budget airline is expecting an increase in Chinese tourism, even though there has been no immediate impact. The chief executive of the South Korean tour agency that caters to Chinese tourists said on Wednesday he just received a request from a Chinese client who asked if an event originally scheduled for Japan in early next year could be relocated to South Korea. He said that "South Korea is clearly going to benefit from this dispute." He said that for the moment, they were in a waiting-and-seeing mode. South Korea welcomed more than half as many Chinese tourists in 2013 due to the territorial dispute between Beijing, Japan and some islands. The Chinese advisory against traveling to Japan has caused South Korean shares in travel-related companies this week to soar. Travel agency Yellow Balloon Tour has seen a 24% increase, and Shinsegae, a department store operator, has seen a 6% gain on the hope that Chinese tourists will switch to South Korea. Travel industry experts said that it may take some time for Chinese tourists to increase in South Korea. Kim Seol Yeong, a tour operator based in Jeju for Chinese cruise tourists, said that the diplomatic dispute had only occurred a few days earlier. It might take some time before we see an increase of Chinese tourists visiting Korea. Luna Wang, 34, from Hangzhou, China, had considered returning to Japan this year, but she may opt for South Korea now. "Now, it seems that Japan is no longer safe for Chinese to travel." She said, "I guess the only option that is good for me to travel to Korea is to go to Japan." The founder of Moment Travel, a Chinese company in Chengdu, noted a dramatic shift in perceptions regarding travel to Japan. Su Shu, the founder of Moment Travel in Chengdu, said that there is now a feeling that anyone who travels to Japan is a traitor. Reporting by Ju-Min Park in Seoul; Casey Hall in Shanghai; and Sophie Yu, in Beijing. Editing by Anne Marie Roantree, Thomas Derpinghaus, and Anne Marie Roantree.
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Lithuania Railway Company stops Lukoil shipments from Russia's Kaliningrad
Due to U.S. Sanctions, the Lithuanian state-owned railway group LTG announced on Friday that it would stop shipments of oil cargoes from Russia's Lukoil into the Russian exclave Kaliningrad. Kaliningrad, located on the Baltic Sea Coast, receives most of its supplies via rail transit via NATO member Lithuania. It can also receive direct shipments via ocean from its own nation. Last month, the U.S. Treasury’s Office of Foreign Assets Control imposed sanctions on Lukoil over the conflict in Ukraine. The OFAC also warned that foreign companies who do business with this Russian group would face consequences if they continued to do so after the November 21 deadline. LTG Group announced in a Friday statement that "cargoes of Lukoil or related companies, oil or petroleum products, will no longer be shipped by rail from Russia to Kaliningrad". The Kremlin said that Lukoil’s international interests must be respected. (Reporting and editing by Terje Solsvik, Andrius Sytas)
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Since August, the US sanctions have hit India, Russian Urals prices in India have tripled.
Three sources in the oil trade reported that discounts for Russian Urals crude have tripled in Indian ports since August compared to Brent dated as U.S. sanction drive key buyers from Moscow-supplied fuel. Last month, the United States imposed their toughest sanctions to date on Russia's oil sector. They targeted Lukoil & Rosneft. The deadline for companies is Friday to end all business with the two oil producers. Urals crude is a staple feedstock for Indian refiners, since 2023 when Moscow diverted flows to Asia following the European Union's ban on Russian energy. Traders said that supplies to India will fall dramatically as most refiners stop buying. Reliance Industries, India’s largest private refiner and India’s largest refinery, has stopped importing Russian crude to its Jamnagar facility in Gujarat as of November 20, according to a spokesperson for the company. RUSSIA OIL IMPORTS FROM WESTERN POINTS ARE NEAR OPTIMAL LEVELS Despite sanctions, Russia’s oil exports to western ports are still near their peak, thanks to OPEC+ production allowances, and refinery shutdowns caused by drone strikes in Ukraine. According to traders, the December Urals cargoes are currently trading at a discount of $5-$6 per barrel compared to Brent. This is about three times greater than the $1-2 seen in August. Prices for Russian oil delivered into Indian ports are usually set on a "delivered-ex-ship" basis. This means that the price does not include transport costs or other charges paid by the seller. Traders said that the price of Urals crude on board at Russian ports depends on the cargo and supplier. It is estimated to be around $20 per barrel. The majority of shipments are handled on "shadow fleets" linked to Russia, which allows Moscow to keep a portion of the differential in price. The freight rates are stable despite the sanctions against vessels. Aframax tankers carrying 700,000 barrels to Baltic ports cost around $7.5 million per one-way trip, while Suezmax trips are between $8 and $8.5 million, traders reported. They added that Russian oil shipments are still expensive but manageable, as there are enough ships available and Urals is trading below the EU's $60 barrel price limit. Conor Humphries (Reporting and Editing)
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Asia spot prices slightly rise amid high inventories and muted demand
The Asian spot price of liquefied gas rose slightly last week but remained in the $11 range due to well-stocked inventories. Average LNG price for delivery to North-East Asia in January Industry sources estimate that the price per million British thermal unit was $11.66 this week, up from $11.10/mmBtu in the previous week. Toby Copson is chairman of Davenport Energy Partners. He said, "The APAC Market remains largely flat or bearish. This is due to (a) a later start to the winter and unseasonably warm temperatures, which are muting seasonal heating demand." He added that "Geopolitical risks premiums have been mostly priced in. So, unless there are any new supply bottlenecks it will trade within this range until we see an extreme and prolonged drop in temperature." The premium of Asian spot gas to European prices at the TTF hub has been increasing for months. This is mainly due to an increase in charter rates, which meant that bringing cargos from Europe to Asia would be more expensive. Alex Froley said, Senior LNG analyst at ICIS. The wholesale gas prices in Europe fell on Friday morning, as the demand for gas was curtailed by warmer temperatures and expectations of a stronger wind output. Prices increased earlier this week due to a cold snap that drove up heating demand. Froley stated that the spot gas prices at TTF hub have remained fairly stable, and the first cold snap of winter has not caused them to significantly increase. Aly Blakeway is the manager of Atlantic LNG for S&P Global Energy. She said that while Europe's storage inventories have decreased, they are still lower than in previous years. On the back of a strong demand for gas to generate electricity, LNG demand is continuing to grow in the East Mediterranean, including Turkey, Greece and Cyprus. Blakeway explained that this, combined with Egypt's rapid procurement of some cargoes, forced sellers to hold back their offers in order to compete for these premium markets. S&P Global Energy's daily North West Europe LNG Marker price benchmark (NWM) for cargoes to be delivered in January, on an ex ship (DES) basis, was $9.994/mmBtu as of November 20. This represents a $0.49/mmBtu reduction from the price at TTF hub. Spark Commodities set the price for December at $10.60/mmBtu. Seb Kennedy, an independent gas analyst, noted that the number of hedge funds trading TTF derivatives reached a record high of over 450 in the past week. This shows the popularity of the EU market for commodity investments. He added that funds bought more TTF-short positions during the week ended November 14, bringing their net position to near zero. According to Spark Commodities analyst Qasim Afghan, the U.S. arbitrage for the front-month to North-East Asia via Cape of Good Hope points to Europe while the Panama Canal arbitrage is open strongly to Asia. The Atlantic LNG rates have risen to their highest level since December 20, 23 at $130,750/day. Pacific rates reached their highest level since August 20,24 at $78,750/day. Marwa Rashad is the reporter. Mark Potter (Editing)
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Sources: US threatens to cut off intel and weapons to force Ukraine into peace agreement
Two people with knowledge of the situation said that the United States had threatened to reduce intelligence sharing and arms supplies to Ukraine in order to pressure it to agree to the framework for a U.S. mediated peace deal. Sources, who spoke on condition of anonymity said that Washington was exerting greater pressure than in previous peace talks, and that it wanted Ukraine to sign the framework of the agreement by next Thursday. One source said, "They want the war to end and they want Ukraine to pay for the price." Washington presented Ukraine with a plan of 28 points, which endorsed some of Russia's main demands during the war. These included that Kyiv cede more territory, reduce the size of its army, and be banned from joining NATO. A senior U.S. delegation met with President Volodymyr Zelenskiy on Thursday in Kyiv to discuss the path to peace. The U.S. ambassador to Ukraine and the Army Public Affairs chief traveling with the delegation described it as a successful meeting and said Washington was seeking an "aggressive deadline" for signing a document between U.S.A. and Ukraine. (Reporting and writing by Tom Balmforth; editing by Philippa Fetcher and Peter Graff).
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Freeport LNG Texas's export plant will take in more natural gases on Friday, according to data.
LSEG data, as well as regulatory filings, show that the U.S. liquefied gas company Freeport LNG was on schedule to receive more natural gas in Texas on Friday. This is a sign of one of three liquefaction train's return to service following its Thursday shutdown. Freeport has been one of the most closely monitored U.S. LNG plants in the world because its changes in operations have caused price fluctuations in global gas markets. Gas prices in the U.S. typically fall when flows to Freeport decrease due to a reduced demand for fuels from the export facility. Prices in Europe usually rise due to the drop in LNG supply available on global markets. The Freeport outage contributed to a 2% decline in futures prices on Thursday in the U.S. Freeport is not responsible for the drop in prices that occurred in Europe. Freeport informed Texas environmental regulators on Friday that Train 1 was shut down Thursday because of a problem with the compressor system. Freeport officials had no comment to make on the incident, but did note that the plant has loaded its 1,000th shipment this week. LSEG reported that gas flow to Freeport was on track to increase to 1.9 billion cubic foot per day (bcfd), up from 1.3 bcfd Thursday. This compares to an average of 1.9 billion cubic feet per day over the previous seven days. Three liquefaction plants at Freeport can convert about 2.4 billion cubic feet per day of gas to LNG. A billion cubic feet of natural gas can supply five million U.S. households for one day. Reporting by Scott DiSavino. (Editing by David Goodman, Mark Potter and Mark Potter.)
Feeding Gaza: Traders run onslaught of bullets, bombs and kickbacks
Mohammed describes a shipment job from hell.
I get screwed on every delivery, the Gazan trader informed . He stated he has to hand over more than $14,000 for each truck of food he brings into the besieged enclave to pay sky-high transport expenses, kickbacks to intermediaries and security from looters. That's up from $1,500-$ 4,000 before the war began in October.
It's hardly worth my while. But I require food, my neighbours require food, the whole of Gaza requires food.
Mohammed said he doesn't like it, but he's required to hike prices of some fresh food like dairy items, fruit and chicken to 10 times their normal worth just to break even, though he understands this puts them out of reach of many hungry Gazans.
He and 17 other individuals interviewed , most of them traders and aid employees in Gaza with direct knowledge of the supply situation, described a chaotic system that frequently makes it too hazardous or costly for entrepreneur to import food, even as aid agencies alert of the growing risk of famine.
A lot of the people requested their complete names be withheld to speak freely about delicate matters, with traders like Mohammed saying they feared reprisals by regional gangs or being blacklisted by the Israeli armed force for speaking up.
The bulk of the cash spent on importing food goes on swelling trucking costs, according to the people talked to.
Chauffeurs in Israel have increased their rates by as much as threefold due to the fact that of attacks by Israeli protesters on trucks heading towards Gaza, they said. Cargoes likewise frequently have to wait for days, either near their departure points in the occupied West Bank or the Kerem Shalom border crossing from Israel into southern Gaza to be examined by Israeli soldiers and authorized to go into the enclave, they included, even more increasing expenses.
Once the items finally make it into Gaza, the sources told , the hairiest part of the journey begins.
Another trader, Hamuda, who imports pickled vegetables, poultry and dairy products from the West Bank, stated he either pays off regional criminal gangs or employs his own armed males to stand on top of the cargoes and fend off looters.
It's anywhere from $200 to $800 for this. It's worth it for a cargo that can be worth as much as $25,000, he stated. The guys I. hire are pals or relatives, I require about 3-5 per truck.
Meanwhile, none of the private-sector goods have made it to. northern Gaza, where aid firms state appetite is most intense,. because the Israeli armed force has closed that location off to their. commercial deliveries, all eight traders said.
2 help workers validated the only food readily available in. northern Gaza is help, with no industrial items for sale. The. Israeli military didn't talk about the accessibility of food for. sale in the north, a location dominated by Gaza City and its. environs.
The military, which manages coordination of aid in Gaza,. says it lets enough food in from Israel and Egypt for the entire. population. It acknowledged aid agencies face troubles in. transporting food once it has entered through crossing points. consisting of Kerem Shalom, without defining what the obstacles. were.
Dispersing help in Gaza is a intricate job considered that it is. an active war zone, a spokesperson told . Israel is. dedicated to allowing humanitarian help to get in Gaza for the. advantage of the civilian population ... it will facilitate it. while sticking to operational factors to consider on the ground.
The military stated Palestinian militant group Hamas, Gaza's. ruling group, was exploiting humanitarian infrastructure for. its military needs, without elaborating.
Hamas denied exploiting help and stated it doesn't interfere. with food deliveries. It validated that traders were employing. armed guards to protect their deliveries however stated none of those. males were linked to Hamas.
Our utmost goal is to relieve the suffering of our. people, said Hamas federal government spokesperson Ismail al-Thawabta.
' TOTAL BREAKDOWN OF LAW'
Getting food to the Gaza Strip's mostly displaced population. of 2.3 million has been beleaguered by bureaucracy and violence since. war broke out on Oct. 7, when a Hamas attack on towns in. southern Israel activated an Israeli bombardment and invasion. that has desolated the seaside area.
There are two main tracks of food entry: global help,. which is largely U.N. or U.N.-distributed products of. non-perishables, like rice, flour and tinned items and has made. up the bulk of imports throughout the war; and business. shipments, which include fresh fruit and vegetables important to fending off. malnutrition.
The Israeli military enabled commercial food deliveries from. Israel and the occupied West Bank to resume in May after its. assault on Gaza's southernmost city of Rafah - an essential gateway. from Egypt - considerably decreased the flow of U.N. help to the. ravaged Palestinian territory.
, which reported the business resumption, is likewise. the first news outlet to information the occurring expenses and mayhem. faced by Gazan traders that have actually hindered their efforts to import. fresh food for sale in the enclave's markets and stores.
Attacks on food trucks have risen given that Israel introduced its. May 7 Rafah offensive, which has actually deepened the chaos in Gaza by. scattering the 1.5 million individuals who had been sheltering in. tent camps there, according to the traders and help employees.
The U.N. materials that are still getting through to Gaza,. via Kerem Shalom or northern crossings, are even more vulnerable. to criminal gangs because, unlike personal businesses, U.N. agencies can't pay for armed protection, according to 6 aid. employees associated with coordinating food shipments. One approximated. that about 70% of the food trucks were being assaulted.
We are faced with a near total breakdown of law and. order with truck chauffeurs being routinely threatened or. assaulted, Philippe Lazzarini, head of U.N. relief company. UNRWA, told . Far a lot of trucks have actually been looted.
The difficulties faced by aid agencies imply the commercial. track has started to comprise a bigger proportion of food going into. Gaza, though the circulation remains erratic, according to the 8. traders interviewed.
They stated private-sector supplies has made up between 20. and 100 trucks a day - each carrying up to 20 tonnes of food -. because the Rafah assault was released. During this period,. Israeli military information reveals approximately 150 aid and commercial. food trucks a day have gone into in overall.
That is well short of the 600 trucks a day that the U.S. Company for International Development says is needed to attend to. the threat of famine.
The business food being available in is likewise costly, and little. replacement for global help that has actually already been spent for. by donor countries and organizations, according to the 6 aid. workers.
Some items have actually increased at least 15-fold in expense, said. Majed Qishawi, of the Norwegian Refugee Council in Gaza. Fundamental. items ... have actually disappeared from the market since of an extreme. drop in aid and commercial trucks arriving.
ISRAELI PROTESTERS ATTACK
Traders explained a long and perilous process to provide. food from their providers in Israel and the West Bank to their. designated destinations in Gaza, a 100-mile journey at the majority of, with. difficulty looming far before items reach the war-torn enclave.
Numerous Gaza-bound freights, transferred by Israeli drivers. or by Palestinian drivers who have consent to work in Israel,. were obstructed or assaulted by Israeli protesters in May in a spree. of violence which triggered Washington to sanction one involved. group with links to Israeli inhabitants. The protesters stated they. were preventing supplies from getting to Hamas.
Israeli drivers in specific have actually hiked their transportation. costs due to the fact that of the attacks - in some cases by 3 times, stated. another trader, Samir. A $1,000 trip can cost $3,000.
Cargoes then often get stuck in lines of trucks before they. can enter Gaza, with long waits costing importers about $200 to. $ 300 per day per truck, he added.
The hold-ups are triggered by a general stockpile in getting food. into Gaza, according to the 18 sources interviewed who also. consist of Palestinian and Western officials.
couldn't individually verify the logjam at the Gaza. border as Israel mostly bars reporters from Gaza and its. crossing points.
The traders and help employees stated that for two weeks at the. start of June, the Israeli military suspended all entry for. industrial items while a stockpile of humanitarian aid was. cleared. One trader shared a text message from an Israeli. military planner for materials into Gaza on June 9 informing. him that industrial circulations were on hold up until additional notice,. though could not confirm its credibility.
The industrial track opened up again around the Muslim Eid. al-Adha vacation start on June 15, individuals said.
BRIBES & & DEFENSE RACKETS
Once food cargoes are permitted to cross into Gaza, the items. are filled onto different trucks with regional drivers to be. dispersed to vendors in the enclave, the traders stated.
They are now in a battle zone.
Stretches of road in Rafah and the southern city of Khan. Younis that were thought about relatively safe before the Rafah. invasion are now infamous for attacks, the traders stated.
Three of the help workers stated truck lootings were an everyday. occurrence while Hamuda, the trader, approximated that about 6. times as many trucks are being raided now compared to. before the Rafah attack.
Some trucks are attacked for freights bring rarer. commodities such as meat or fresh fruit, Hamuda stated. Lots of. others are assaulted by gangs who have actually secretly organized to. smuggle items inside food shipments, specifically tobacco.
One Gazan trader shared a photo of cigarettes smuggled. inside a hollowed-out watermelon, though couldn't validate. its credibility.
Another challenge is continuous Israeli operations, according to. the traders who stated they have no military official to contact. in genuine time while their trucks are inside Gaza.
If a road is closed by combating or bombardment, they have no. method of figuring out a safe option, or relaying this. information to their motorists who are typically outdoors mobile phone. protection, they added.
3 traders said that last month they started paying larger,. better-connected Gazan entrepreneurs who have routine coordination. with the Israeli military to protect the entry of their cargoes. and protection for their trucks to their destinations.
The traders, who decreased to recognize the middlemen, stated. this service alone can cost approximately $14,000 to get the goods to. their location safely.
One of the traders, Abu Mohammed, stated he had to weigh up. just how much he could offer his cargo for. After treking my prices to. make up for the transportation costs, possibly I make a couple of. hundred dollars. Perhaps I break even, he said.
I also run the risk of losing everything, he added. If the delivery. is ransacked, my cash's been lost..
(source: Reuters)