More observations on EU/US sanctions on Russia & possible implications on logistics disruption.

In April, India bought Russia crude for frist time ever. It bought 15mb in April according to news, altough we yet only measure 9mb as at 17 April 2022 through @Kayrros.

1/4 Image
How much crude needs to be diverted to Asia if self-sanctioning (or EU ban) bites? At least 2.9mbpd of Russian Urals in EU (1.6-1.8mbpd seaborne; 1.3mbpd Druzhba pipeline system into the EU) need to be diverted. So far, seaborne loadings increased in March! Time will tell.

2/4 Image
What does it mean to divert 1.8mbpd seaborne Urals away from Europe & into Asia? According to our calculation, it would increase ton-miles by a factor of 6 (!) & voyage time by a factor of 5 (!). In other words, Russian crude voyages will jump from 15 to 75 days on average.

3/4 Image
The shift to Asia already began: Flows of crude to Asian countries from Russia’s western ports have surged from zero in the weeks prior to the invasion to 875,000 barrels a day in the first full week of April.

#OOTT #tankers #Suezmax Image

• • •

Missing some Tweet in this thread? You can try to force a refresh
 

Keep Current with Alexander Stahel 🇺🇦

Alexander Stahel 🇺🇦 Profile picture

Stay in touch and get notified when new unrolls are available from this author!

Read all threads

This Thread may be Removed Anytime!

PDF

Twitter may remove this content at anytime! Save it as PDF for later use!

Try unrolling a thread yourself!

how to unroll video
  1. Follow @ThreadReaderApp to mention us!

  2. From a Twitter thread mention us with a keyword "unroll"
@threadreaderapp unroll

Practice here first or read more on our help page!

More from @BurggrabenH

Apr 27
Can the European Union ban Russian gas imports?

Answer: Faster than you might expect, but it comes down to great leadership & setting the right priorities!

We continue - Part II with a total of 25 Tweets

1/n 🧵
#UkraineRussiaWar #EuropeanUnion
In part I we explained that Europe must replace 150bcm of Russian gas imports to help support the end of the Russian genocide in Ukraine.

It will also be the recipe to reduce the current risk-premium in gas prices & avoid long-lasting food shortages or a refugee crisis.

2/n Image
We explained that...
- (1) higher LNG imports from optimised infra & capacity utilisation can deliver up to 90bcm or 62% of 150bcm if free market prices can continue to "pull" LNG into Europe;
- (2) one-off storage potential of up to 25bcm (one winter) to buy some time...

3/n
Read 22 tweets
Apr 27
Can the European Union ban Russian gas imports?

Answer: Faster than you might expect, but it comes down to great leadership & setting the right priorities!

Let's go - Part 1 of a total of 25

1/n 🧵
#UkraineRussiaWar #EuropeanUnion
Basics first: How much gas does Europe need to replace (not just the EU, UK et al too)?

Answer: Europe purchased 150 billion cubic meters (bcm) of gas from Russia, imported from 3 pipelines & 15bcm in the form of Liquified Natural Gas (LNG) by sea.

2/n Source: Burggraben Image
Why is it important to cut Russian gas?
Because it finances Putin's genocide in Ukraine which in turn pushes gas prices up. That destroys businesses and - for heaven's sake - creates food shortages with a subsequent refugees crisis.

3/n #foodshortage
Read 26 tweets
Apr 25
Food prices likely have to go higher in the coming month & despite the macro system stress.

Result: Looking at the data for the past 30 years, the FAO Food Price Index (@FAO) would have to rise by 30% to match Ammonia's cost for farmers.

1/9 Thread Image
First, what food matters and why?
Answer: to feed 7.9 billion people grains & rice matter most.

2/n
What do farmers need to to maximise crop yields of wheat, corn or soybeans?
Answer: they need 3 fertilisers, namely Nitrogen (ammonia), Phosphorus & Potassium. The mix varies by region but the world cannot be fed without the three.

3/n courtesy @WillisThomas & CRU Image
Read 9 tweets
Apr 22
Dollar Wrecking Ball - Brazil exports 55% of global #soybeans (mainly to China). Issue: US export 35% which seems to set international prices. That turns soybeans farming in Brazil into poor business at current potash prices ($1250/Mt) b/c of BRL-FX rate.

@WillisThomas Image
Same for corn. BRL exports 21% of total, ARG 20%, US 32% while setting prices. LatAm farmers need fertiliser subsidies or use less which would reduce yields & worsen ongoing food crisis. What do I miss? Stocks? Labour cannot move dial. Below BRL, worse for ARS.

@Fernand89000071 Image
Read 5 tweets
Apr 20
There have been 8 shocks to the global food prices - yes eight (8). Most of them are ongoing!

🧵

1/n As for team transitory,…
No 1 - War: Ukraine, which was known as the ‘breadbasket of the FSU’, has 1/4 of world’s ‘black soil’ fertile land. In 2021 Ukraine accounted for 20%, 7%, 18% of global exports of barley, wheat & corn, respectively. It is under attack & VVP wants this war to be a food crisis.

2/
He will get his will. The UN Food and Agricultural Organisation estimates that 20-30% of sunflower, grains and corn will not be planted or harvested. It forecasts food prices to rise by another 8-22% because of the loss of Ukrainian production (FT, 9 April).

3/n
Read 19 tweets
Apr 19
“Lower fertilizer use [b/c of higher cost] may mean a smaller crop. The International Rice Research Institute predicts that yields could drop 10% in the next season, translating to a loss of 36m tons of rice, or the equivalent of feeding 500m people.”
bloomberg.com/news/articles/…
“Rice farmers are particularly vulnerable. Unlike wheat & corn, which have seen prices skyrocket, rice prices have been subdued due to ample production and existing stockpiles.”

@WillisThomas @ElenaNeroba @RussianGrainTra
Urea prices are a derivative of ammonia prices which in turn are subject to natgas prices.

@DoombergT explained it nicely a while back.
Read 4 tweets

Did Thread Reader help you today?

Support us! We are indie developers!


This site is made by just two indie developers on a laptop doing marketing, support and development! Read more about the story.

Become a Premium Member ($3/month or $30/year) and get exclusive features!

Become Premium

Don't want to be a Premium member but still want to support us?

Make a small donation by buying us coffee ($5) or help with server cost ($10)

Donate via Paypal

Or Donate anonymously using crypto!

Ethereum

0xfe58350B80634f60Fa6Dc149a72b4DFbc17D341E copy

Bitcoin

3ATGMxNzCUFzxpMCHL5sWSt4DVtS8UqXpi copy

Thank you for your support!

Follow Us on Twitter!

:(