Sanctions on Venezuela to Blame for US Purchasing More Fuel from Russia

While Washington urges its European allies to reduce their dependence on Russian energy resources and imposes sanctions on the Nord Stream 2 gas pipeline, the US itself urges Russia to supply it with more fuel, and even made its largest diesel purchase in three years. Experts on the subject explain why this trend is happening.

Four Russian tankers with a total of two million barrels of diesel fuel made from natural gas left for the United States to help mitigate the energy crisis in the North American country. This represents the highest purchase of this type since 2018, reported the Bloomberg agency, citing reference data from Vortexa’s monitoring and analysis platform.

Russian vessels should reach the US coast next week, and will help contain US fuel prices that have reached the highest levels in the last seven years.

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“Russia is better positioned to supply diesel than other refineries in Europe due to its access to cheap natural gas,” explained Clay Seigle, director of Vortexa in Houston.

These types of purchases—by the US from Russia—are quite rare, analysts say. So why is the US blocking trade with Russia with one hand, and buying its hydrocarbons and derivatives with the other?

The worst part is that the disruption of US oil supplies has been caused by its own ineptitude, due to the illegal blockade against Venezuelan oil exports affecting millions of Venezuelans and millions of US citizens.

Imbalance between consumption and production
Although the United States is today the largest oil producer in the world, it still produces less than what it consumes, producing 11.4 million barrels per day while it consumes about 20 million barrels each day.

Historically, Venezuela supplied US refineries with heavy and viscous oil. After the imposition of illegal sanctions on the oil input from Venezuela, the US has been increasing the purchase of oil and derivatives from Russia for several years, mainly heavy fuel oil. This diesel purchase reflects a high level of desperation, explains Alexander Frolov, deputy director of the National Institute of Energy of Russia, quoted by the newspaper Vzglyad.

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“The United States has lost about 20 million barrels of oil per month, which were supplied by Venezuela,” Frolov explained. “This volume had to be compensated for with other sources. And one of these sources is Russia. Now it ranks second or third, depending on the month.”

The largest supplier of this type of hydrocarbons to the United States is Canada, which contributes half of the imports of its southern neighbor. The second largest supplier is now Mexico. Added to this is the fact that the Canadian oil refinery Irving Oil has been under scheduled maintenance since September, and is just resuming production. These factors have significantly boosted fuel prices in the US.

Frolov points out that the price of a liter of gasoline in the US is already close to a dollar, and a liter of diesel is more or less the same,  30-35 cents more expensive than its cost at the beginning of the year.

“All this suggests that it is still too early to bury traditional motor fuel,” concluded Frolov. “The US denies these ‘wonderful’ stories with its own example.”

 

 

Featured image: Oil tankers waiting to load/unload their shipments. Photo by Sputnik/Vitaly Timkiv/Open photo bank.

(Sputnik) with Orinoco Tribune content

Translation: Orinoco Tribune

OT/JRE/SL

 

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