(EnergyAsia, June 18, Thursday) — Russia has historically exported medium sour crude, but over the next decade, there will be an increase of more than two million b/d in the sale of light low-sulphur crude, said Boston, Massachusetts-based consultant ESAI.
In its latest CIS Watch report focusing on the former Soviet states, ESAI noted that Russia will start work on phase two of its Baltic pipeline system this month while soon completing phase one of the East Siberia-Pacific Ocean pipeline.
Changes to Russian export infrastructure reflect both its new crude oil export strategy and the changing landscape of Russian oil output.
ESAI predicts that Russian exports of light sweet crude to Europe will grow by more than one million b/d over the next decade.
In the Black Sea, growth will result from development of the Russian Caspian and the increase of transit flows from Kazakhstan.
In northwestern Russia, the development of Timan-Pechora will support growth of light sweet exports from the Barents Sea. These developments will partially offset declining North Sea supply of light sweet crude.
Growth of supply via the ESPO pipeline will raise Russian light sweet exports to Asia to 1.3 million b/d by 2020 based on ESAI’s forecast for supply growth and exports.
“Russian light sweet will be an attractive substitute for China’s declining output of medium sweet,” said ESAI analyst Andrew Reed.