Global oil trade flows are already realigning after the Western sanctions on Russian exports, as Russia places more crude in Asia while other producers send part of the volumes previously intended for Asia to Europe and other markets, according to Saudi Aramco's chief executive officer.
"And crude that used to go to Asia is now being directed to Europe and other parts of the world," Aramco's CEO Amin Nasser said at the Future Investment Initiative (FII) forum in Riyadh on Wednesday, as carried by Bloomberg.
"Realignment is happening," the top executive of the world's largest oil firm said.
"Russians, with the right discount, they are able to place their crude in different markets," he added.
Russia faces insurance and logistics issues, but it is working to overcome those with discounts on its crude, Nasser said.
Although it must travel longer distances, Russian oil is flowing increasingly to Asia. Meanwhile, crude oil from elsewhere that would have otherwise gone to Asia is now being shipped to Europe and other markets, he added.
China and India have significantly increased purchases of Russian crude since the Russian invasion of Ukraine. China has always been a major customer of Russia, but India has never imported so much Russian oil as it did in the months following the invasion in February. China and India have become Russia's key energy buyers after the Russian invasion of Ukraine, as most Western countries shun, ban, or are about to embargo imports of Russian energy products.
In recent weeks, Russia has ramped up oil exports to China, India, and Turkey ahead of the EU embargo on imports of Russian crude starting on December 5.
Almost all tankers carrying Russian crude that signal destinations such as Port Said, Gibraltar, or "for orders" eventually end up in one of those three countries, according to Bloomberg estimates.
By Tsvetana Paraskova for Oilprice.com
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Tsvetana is a writer for Oilprice.com with over a decade of experience writing for news outlets such as iNVEZZ and SeeNews. More