Oil transit through Russian ports could be partly replaced by routes through the port of Aktau, the Baku-Tbilisi-Ceyhan (BTC) pipeline, or rail shipments to China or Uzbekistan, Report informs referring to the review of the Argus agency. Earlier in March, oil loading at the CPC marine terminal near Novorossiysk was halted due to an accident.
“The ability of oil suppliers from the Caspian region to transit through Russian ports may be significantly limited by sanctions, market participants believe. In addition, freight rates have risen, and the cost of transporting oil from Novorossiysk since the end of February provides for an additional insurance premium for war risk,” Argus analysts say.
In 2021, the total transit of crude through Russia amounted to 67.1 million tons. Of these, the vast majority (64.3 million tons) fell on the exporters of Kazakh oil, 1.8 million tons of oil - from Turkmenistan, 1 million tons - from Azerbaijan.
According to Argus, oil suppliers from the Caspian region can send the largest volumes of crude for export through the Kazakh port of Aktau (the port transships 2.1 million tons of raw materials with a design capacity of 11.6 million tons per year).
“As the main alternative export route from Aktau, shareholders of large projects in Kazakhstan are considering the possibility of deliveries via the Baku-Tbilisi-Ceyhan oil pipeline,” analysts say. Its design capacity is 60 million tons per year, last year its actual loading was 26 million tons. A market participant in a conversation with the agency noted that there is a surplus of capacities in the pipeline itself, but the infrastructure for receiving transit volumes is limited. The entire volume of transiting crude to BTC is supplied by the trading division of the State Oil Company of Azerbaijan - SOCAR Trading.
Also, Kazakh suppliers are considering the possibility of shipping raw materials by rail in the direction of the Batumi Oil Terminal (BOT) with a design capacity of 12 million tons per year. Last year, 1.5 million tons of oil and oil products passed through this complex, mainly its capacities are used to accumulate batches of Russian oil, which comes to the port on small ships.
According to analysts, in recent years, Kazakhstan has exported raw materials to China only through the Kazakhstan-China pipeline. Its main segments are Kenkiyak - Kumkol (10 million tons per year) and Atasu - Alashankou (throughput - 20 million tons per year). According to Argus, given the current supply to China of 11 million tons per year from Kazakhstan and Russia, the capacity of the second section allows pumping another 9 million tons per year to China. Part of the raw materials can be delivered to it by rail. Analysts also believe that another 3-5 million tons of oil from Kazakhstan can be brought to China by rail through the border crossings Dostyk-Alashankou and Altynkol-Khorgos.
The agency notes that deliveries by rail to Uzbekistan may become another direction for Kazakh exporters. According to the agency's source, the volume of shipments in this direction is unlikely to exceed 1-2 million tons per year.
In addition, several Kazakh producers are considering the possibility of resuming trans-Caspian oil supplies to Iran under a substitution scheme. They will be possible after the easing of sanctions against the Islamic Republic.
On March 22, the Caspian Pipeline Consortium, the largest shareholders of which are Transneft (24%) and the Kazakh KazMunayGas (19%), suspended the operation of two of the three remote mooring units at the sea terminal near Novorossiysk due to damage generated during the storm. Deputy Minister of Energy Pavel Sorokin explained that if the damage to the CPC terminal is confirmed, it will take 1.5-2 months to restore it. At the same time, 80% of the shipment, or up to 1 million barrels per day, will be potentially lost.
Later, CPC General Director Nikolai Gorban said that oil loading at the company's sea terminal near Novorossiysk had been completely stopped. Reception of raw materials through the pipeline occurs, but the reservoir capacity ends. According to his estimates, oil shipments at the CPC terminal in March-April may fall by five times.
Russian Deputy Prime Minister Alexander Novak warned that during the restoration of the terminal, a certain amount of oil would not be supplied to the markets, which would affect them.
https://report.az/en/energy/baku-tbilisi-ceyhan-named-as-main-alternative-route-for-export-of-caspian-oil/