No fuel supply risk in next two weeks after Kazakhstan suspends oil deliveries, Romanian PM says

Acting prime minister Ilie Bolojan, who is also serving as interim energy minister after his cabinet lost a no-confidence vote back in May, said during a lengthy July 23 press conference that Romania will not face fuel supply problems over the next two weeks, although the country's main oil supplier, Kazakhstan, has temporarily suspended deliveries through the Caspian Pipeline Consortium, or CPC.

The suspension came after suspected Ukrainian drone attacks forced Kazakhstan’s main export terminal on the Black Sea to close. 

The Caspian Pipeline Consortium is a 1,510-kilometer oil pipeline connecting Kazakhstan's oil fields with the Russian Black Sea port of Novorossiisk. Oil loaded at Novorossiisk is then transported by tankers to global markets.

Approximately 80% of Kazakhstan's oil exports, including those from fields operated by Western companies, are transported through the CPC pipeline. However, the infrastructure is also used to transport Russian oil, which has made it a target in the context of the Russia-Ukraine war.

"Loading operations at CPC are currently temporarily suspended to ensure the safety of vessels, crews, and the environment in the Black Sea. However, all of the consortium's production and technical facilities are in good operating condition, functioning normally, and are ready to resume crude oil loading as soon as the situation returns to normal," Kazakh officials said, according to News.ro.

Disruption to the route, which ​handles around 2% of the world's daily crude supply, adds to pressure on an oil market ​already grappling with the effective closure of the Strait of Hormuz and threats to ⁠Saudi Arabian exports via the Red Sea, according to Reuters.

Romania sources 60% of its oil from Kazakhstan through the CPC pipeline. Following discussions held by representatives of the Ministry of Energy with fuel market companies, the supply issues will not be felt immediately. "At least over the next two weeks, we do not estimate that there will be supply-related problems,” the Romanian PM said.

“Rompetrol, which sources its supplies from Kazakhstan, is looking for additional options to transport crude oil so that it can continue refining under normal conditions in August as well and, if this issue is not resolved, it estimates a 10–15% decline in production during August at the Petromidia Refinery," Ilie Bolojan said.

He emphasized that another problem concerns supplying the entire country, especially the western part, due to a bottleneck in the Constanța–Fetești area, where ongoing works mean the depot supplying all of Romania from the Oil Terminal cannot dispatch tanker trains to the western region at regular intervals.

The bottleneck, coupled with the busy summer train schedules, forced officials to authorize dedicated nighttime fuel trains to ensure distribution in western Romania.

"You cannot know what will happen in the Black Sea, what will happen in the war between Russia and Ukraine, what will happen in the Strait of Hormuz, and so on. So you cannot estimate such things. But so far, the Romanian market has proven capable of coping in terms of supply, thanks to diversified supply sources, and, of course, we could not avoid being influenced by global price dynamics," the interim prime minister said.

radu@romania-insider.com

(Photo source: gov.ro) ...