In recent weeks, Europe has increased purchases of U.S. crude as it considers the details of a ban on imports of Russian crude and refined products.
A week after the European Commission officially proposed a full ban on Russian crude and oil product imports by the end of the year, the EU is still scrambling to find a common position, trying to persuade Hungary and some other central European countries to drop their opposition to an embargo.
“We made progress, but further work is needed,” European Commission President Ursula von der Leyen said late on Monday following a meeting with Hungarian Prime Minister Viktor Orban.
Meanwhile, U.S. crude is flowing to Europe at rates never seen before.
Two cargoes of high-sulfur crude from the U.S. strategic reserve are headed to Italy and the Netherlands, according to tanker-tracking data and sources briefed by Bloomberg. The tankers have loaded crude at terminals connected to storage caverns of the SPR in Texas and Louisiana.
According to Matt Smith, oil analyst at commodity data firm Kpler, these would not be the last crude exports out of the U.S. SPR to Europe.
In April, some 1.6 million barrels of U.S. crude from the strategic reserve made its way to Europe, Smith told Bloomberg, adding: “That’s the largest amount of SPR crude that’s been shipped to the continent based on historical monthly data.”
Although the EU is still working out the details of an embargo on Russia’s oil, many buyers in Europe are generally staying away from Russian crude and products, while May 15 is the deadline for European buyers to wind down and halt transactions with Russian oil firms, including Rosneft.