Russia Halts Gas Supplies to Bulgaria and Poland
April 27, 2022
The API inventory report called crude oil stocks up 4.8 million barrels and gasoline stocks were down by 3.9 million barrels and distillates were up 431,000 barrels.
The estimates from the Bloomberg survey for today’s DOE inventory report are for crude to be down 225,000 barrels, gasoline up 300,000 barrels, and distillates to be down 986,000 barrels.
ULSD continues with it volatility as it has had a 40-cent range in the last two days and is down 10 cents this morning in what has been a very volatile few days for ULSD futures.
News that the Chinese government did not impose COVID-19 lockdowns in Beijing and promises to provide stimulus to the people impacted by the prior lockdowns helped energy prices rally in yesterday’s trading session.
Russia halted gas supplies to Bulgaria and Poland for rejecting its demand to pay in rubles. The concerns are raised that more states might be impacted. Germany receives more than 50% of its gas from Russia. This action sent gas prices higher and has increased the concerns about the economic impact of this war.
Trafigura Group said it will stop all purchases of crude oil from Russia’s Rosneft by May 15. It will also substantially reduce the volume of refined products it buys from Rosneft. Under EU sanctions imposed against Russia, traders will no longer be able to buy oil from Rosneft after May 15 unless it is strictly necessary to secure the EU’s energy needs.
Russia’s Rosneft offered oil products from its refineries for loading May-June in a tender requiring pre-payment in rubles. Last week, Rosneft offered 6.5 million tons of crude oil via tenders for loading in May-June, seeking full pre-payment in rubles for the first time. However, it failed to secure any sales as terms proved hard to meet. The company gave buyers the option, where it is not possible to pay in rubles to pay in Chinese yuan, US dollars, euros, UAE dirhams, and Turkish lira. However, these options are subject to negotiations and could be refused by Rosneft.