Russia Has a New Oil Trade Route

In light of impending Western sanctions against Moscow, Russia appears to have discovered a new method of selling its oil.

The El Hamra oil port in Egypt received a shipment of around 700,000 barrels of Russian oil in July. According to ship tracking information tracked by Bloomberg, a different ship collected a package from port a short while later that could have contained part or all of the Russian barrels. The cargo's eventual destination is more elusive, which contributes to a pattern in which European consumers have shunned Russian oil exports following the nation's invasion of Ukraine.

El Hamra features six storage tanks with a total capacity of 1.5 million barrels of crude oil and a single dock for loading and unloading. It is run by Egypt's Western Desert Operating Petroleum Co. It is possible to mix Russian barrels with local quantities at the terminal because it was designed to handle crude oil produced in Egypt's western desert. Russia now transits fuel oil through Egypt. El Hamra's employment as a port for Russian oil shipments may not be a one-time thing, as is currently believed.

Another oil cargo transfer appears to have taken place in Johor, close to Singapore, in June, according to a report from Bloomberg. Johor is a recently developed hub for the transshipment of Iranian crude oil destined for China.

The European Union will impose a restriction on oil exports from Moscow as well as on the supply of insurance and other maritime services, putting pressure on Russia to find and test other delivery options for its commodities.