ÜSurprisingly, Shell announced on Tuesday that it intends to completely stop supplying oil and gas to Russia in the future. There will be a “gradual withdrawal”. As a first step, Shell will immediately stop all spot market purchases of Russian crude oil, the group said.
Shell now wants to change its sources of supply in order to end Russian supply volumes. “We will do that as soon as possible,” said the group. But because of the physical delivery locations and the availability of alternatives, it should “take weeks” before the reference to Russia can be completely stopped. And it will lead to reduced gasoline production in the refineries. Shell, one of the largest mineral oil companies in the world, reacted faster to the Ukraine war than politicians – although rumor has it that the US government was already making such a move when Shell announced its withdrawal from Russia on Tuesday afternoon.
“Constant dialogue and a level-headed approach”
The British group’s decision highlights the dependence of German companies and consumers on Russian oil supplies: 34 percent of all German crude oil imports come from Russia. “We consider the situation to be very serious,” explains the trade association en2x, in which the German mineral oil industry is organized. An internal crisis team continuously assesses the situation. And even if a spokesman says: “The domestic supply is currently still normal”, the sentence shows the dynamics of the situation.
“Should deliveries fail, that is a challenge that we are currently dealing with intensively,” says the association, which in no way wants to stir up panic, on the contrary: “In these difficult days, constant dialogue and a level-headed approach are of particular importance .”
Without making big words, the mineral oil industry has already started to prepare for possible bottlenecks and has significantly restricted the supply of wholesalers via the spot market in order to be able to create reserves itself. While the majority of oil deliveries are made on the basis of existing contracts, it is quite common for certain quantities to be purchased directly from the oil companies’ refineries or depots at current prices. This can either be used to cover unexpected demand or to take advantage of price fluctuations. According to estimates from the industry, around 10 percent of petrol is sold in this way, with diesel, which is important for industry and transport, it should be twice as much and in the case of heating oil, even half the volume is at times the spot market. These quantities are now likely to shrink significantly. “We are doing everything we can to ensure the supply. This includes that the spot goods are limited,” confirmed a spokeswoman for Shell Germany.
Oil prices are rising rapidly
There are no acute bottlenecks in supply, reported the internet portal Heizoel24 on Tuesday, to which 500 oil traders report their prices – but prices have risen drastically. 100 liters currently cost 185 euros. Not only is that a new all-time high, but it’s also roughly double what it was before Russia attacked Ukraine. “There’s enough goods there,” said Oliver Klapschus, head of Heizoel24 in the FAZ. The waiting time, at two to three weeks, is also not unusually long at the moment.
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