Tanker tracking data showed that the US imported 1.078 million tons of fuel oil from Russia in July, up 16% from June. Demand for the Russian fuel oil has received support from attractive pricing and lower freight rates, traders said. For the first seven months of 2020, imports of Russian fuel oil reached 6.4 million tons, on track to match last year’s record-high volumes.
Russian fuel oil shipments to the US began increasing after Washington imposed sanctions on Venezuela and stopped purchasing heavy crude from the South American country about a year ago Many US refineries were designed to process heavy crude grades from South America and cannot process light oil that the US produces domestically. These refiners mostly use Russian fuel oil as a feedstock for further refining and for marine fuel.
Russian fuel oil cargoes to the US were mostly shipped from the port of Ust-Luga in the Baltic Sea, tanker tracking data showed. These shipments arrive mainly in the US Gulf of Mexico area, including Houston and Galveston in Texas which have nearly 50 refining facilities.
