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Traders say that sanctions force Russia to dump its naphtha in STS transfer and storage hubs.

Traders and LSEG data show that Russia has increased its naphtha exports to STS and port storage hubs, as key buyers reduce imports due to?Western sanction pressure.

Since the European Union's full embargo against Russian oil products went into effect in February 2023?,?most? of?Russian naphtha is being directed towards the Middle East and Asia. India and Taiwan were among the largest Asian buyers. However, recent U.S. sanction have caused both countries to withdraw.

According to LSEG, Taiwan hasn't imported Russian naphtha from the beginning of 2026. This compares with 2.7?million tonnes in 2025.

Shipping data showed that traders were avoiding Russian cargoes by sending tankers with a total of 180,000 tons of naphtha, among others, to the port of Mailiao, Taiwan.

India imported approximately 200,000 tons of Russian naphtha per month on average in the past year. However, its purchases have nearly halved since buyers say they will only accept cargoes from non-sanctioned parties.

According to LSEG, out of 'three cargoes' loaded in Russia's Baltic Ust-Luga Port in December, two -- with a total weight of around 100,000 tons -- have been discharged in India since early February. The third shipment, weighing 23,000 tons, is still awaiting discharge.

The U.S. president Donald Trump ordered in December a blockade of all sanctioned oil tanks entering or leaving Venezuela.

Venezuela uses naphtha as a diluter to make its heavy oil transportable.

LSEG data indicates that one tanker originally destined for Venezuela has drifted in the port awaiting orders. Another 60,000-ton shipment was redirected to Oman.

Shipping data indicates that as major buyers have withdrawn from Russian supplies traders are increasingly turning to STS?operations near Port-Said in Egypt as well as storage hubs located in Singapore,?Fujairah, United Arab Emirates, and Malaysia.

Market sources stated that barrels stored in storage can be blended with other products and sold to Asian?and African markets.

The traders also report an increase in the shipments of naphtha from Russian ports to Brazil, Togo and other countries, where it is mainly used as a gasoline blend, although some volumes are also stored and reexported.

(source: Reuters)