Page 173 - ΝΑΥΤΙΚΑ ΧΡΟΝΙΚΑ - MARTIOS 2023

ENERGY & NATURAL RESOURCES

SHELL CEO: “A LONG WAY TO GO office on 31 January, Mark Williams,
BEFORE THE END OF THE ENERGY Research Director of Short-Term Refining
CRISIS” & Oil Products, said that the oil products
According to Shell’s CEO Wael Sawan, price cap, which came into force on 5 Feb-
Europe’s energy crisis is a “multiyear issue”, ruary, would have minimal impact on Russian
and governments will have to work faster refining crude runs and distillate exports.
to address gas supply shortages. “With Russian Urals trading at US$40/
On the sidelines of the energy giant’s bbl on an FOB basis, capping the price
release of its financial results, he empha- at US$100 per barrel and US$45/bbl,
sised to analysts that the fact that full respectively, would still see Russian refin-
LNG terminals and the mild winter pushed ing margins of US$20-US$30 per barrel,”
prices down does not mean a return to nor- Williams said. “Russian refining economics
mality. “We are not out of the energy crisis are still very strong at these levels, so the
in Europe. We have a long way to go [...] We incentive to refine crude into oil products
should not have to rely on the weather,” remains high.”
he said. Alan Gelder, Vice President of Refining,
It is characteristic that European LNG Chemicals and Oil Markets at Wood Mack-
import flows surged last year as the Old enzie, said that the challenge for Russian
Continent looked to boost energy security refiners is finding a pool of new, more dis-
and replace pipeline gas from Russia. Most tant buyers to replace the distillate barrels
of these flows came from the US. currently clearing into Europe. However, he
added that with the price cap set at the
TRILLIONS INVESTED IN GREEN proposed levels, Russian distillate prices
ENERGY could theoretically discount by a further
Green investments are increasing while US$200/tonne vs market benchmarks
the competition between green energy before eliminating the commercial incen-
and fossil fuel projects is fiercer than ever. tive to operate their refining sector.
According to an AFP report, investments Russia has increasingly diversified its dis-
in green energy will exceed $1 trillion in tillate exports in recent months, according
2022, nearly surpassing investments in to Wood Mackenzie’s VesselTracker data.
fossil fuels. However, despite the emergence of new
This development is an aftereffect of the export markets for Russian distillates,
energy crisis sparked by the Russian inva- the re-distribution of Russian oil product
sion, according to a BloombergNEF report trade from the EU import ban does have a
cited in the AFP article. Investments in broader market impact. Williams expects
renewable energy sources, nuclear energy, Q1 2023 Russian crude runs and diesel
zero-emission vehicles, and recycling proj- exports to be ~800 kb/d and ~200 kb/d
ects amounted to $1.1 trillion in 2022. lower than Q4 2022 levels, which will sup-
It is worth noting that the largest investor port both global crude and diesel prices
in energy transition projects is China, which through H1 2023.
is also the top energy producer worldwide.
Almost 50% of the total investment was GREECE-BULGARIA DEALS CHANGE
on Chinese soil and focused on recycling, SE EUROPE’S ENERGY MAP
renewable energy, and electric vehicles. Prime Minister Kyriakos Mitsotakis spoke of
agreements that “change the energy map
RUSSIAN REFINERY PRODUCTS of Southeast Europe” during a joint state-
WILL CONTINUE TO FLOW IN 2023 ment with the President of Bulgaria, Ruben
DESPITE THE EUROPEAN PRICE CAP Radev, in Athens recently after signing
The European Commission’s announce- two memoranda on energy infrastructure
ment that the EU is proposing a US$100 with the neighbouring country. According
per barrel price cap on Russian oil prod- to the prime minister, these agreements
ucts such as diesel, jet fuel, and gasoline, (including the possible extension of the
and a US$45 per barrel cap on discounted existing Alexandroupolis-Burgas pipeline
products like fuel oil, would not severely agreement) will enable the two countries
impact Russian refiners, according to to provide energy to the European Union
Wood Mackenzie. and contribute to Europe’s energy security.
Speaking at Wood Mackenzie’s London Energy Ministers Kostas Skrekas and

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