2024.08.26

[SLOW] OFAC Santion Tanker List 

US Sanctions seven LNG carriers linked to Russian Arctic projects on eve of Ukrainian Independence Day

The U.S. Treasury's Office of Foreign Assets Control (Ofac) has sanctioned seven LNG carriers connected to Russian Arctic energy projects, marking a significant move ahead of Ukrainian Independence Day. These sanctions target 400 individuals and entities aiding Russia's war efforts, including three Palau-flagged LNG carriers - the 138,000-cbm Pioneer Spirit (ex-LNG Pioneer, built 2005), the 137,231-cbm Asya Energy (ex-Trader IV, built 2002) and the 138,000-cbm Everest Energy (ex-Metagas Everett, built 2003) - that recently loaded cargoes from Russia's Arctic LNG 2 plant. Additionally, four modern ice-strengthened LNG carriers - the 174,000-cbm sister ships North Air and North Mountain (both built 2023) and the newbuildings North Sky (ex-North Star) and North Way (ex-North Wind) - built for Russian business, now owned by a Dubai-based entity, were also sanctioned. The U.S. Treasury emphasized its vigilance against Russian efforts to evade sanctions through overseas branches and subsidiaries.

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[SLOW] OFAC Santion Tanker List _ OFAC-listed tanker count flow

China opposes US sanctions on Russia-linked entities, vows to protect domestic companies

China's Ministry of Commerce expressed strong opposition to recent U.S. sanctions that include Chinese companies accused of supporting Russia's war efforts in Ukraine. In a statement released on Sunday, Beijing urged the United States to cease what it called "wrong practices" and pledged to take necessary measures to safeguard the legitimate rights and interests of affected Chinese firms. The U.S. Department of the Treasury announced the sanctions on Friday, targeting hundreds of individuals and entities—including those based in Hong Kong and mainland China—for providing products and services that help sustain Russia's military operations and evade existing sanctions. Earlier this year, Chinese President Xi Jinping had cautioned the U.S. against targeting China, highlighting concerns over bilateral relations. The latest sanctions also encompass liquefied natural gas ships connected to Russia's Arctic LNG 2 project, which is already under U.S. sanctions.

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[SLOW] Weekly Dirty Tanker Research _ China refinery run rate

Sinopec's upstream gains offset refining weakness, leading to slight profit increase in first half

Sinopec, China's leading oil refiner, reported a 1.7% increase in net profit for the first half of the year, reaching 35.7 billion yuan ($5 billion). The profit growth was driven by strong performance in its upstream operations, which helped counterbalance challenges in its refining and petrochemical sectors. Despite revenue remaining at 1.58 trillion yuan, Sinopec faced pressure from an oversupply of oil products due to expanded refining capacity and weakening demand, partly due to the rise in electric vehicles and LNG-powered trucks. The company plans to increase capital expenditure in the second half and maintain production levels of gas and crude oil.

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[SLOW] Daily VLCC Market _ VLCC TCE comparison by routes - 30 days

VLCC freight rates drop as charterers regain control

VLCC freight rates experienced a sharp decline after a brief rally, with rates falling over 15% from Thursday to Friday. Clarksons' fleet-weighted average assessment dropped to $37,700 per day, marking a significant decline from the previous week's $42,800 per day. This downturn follows a recent standoff between ship owners and charterers, with charterers now regaining control of the market, leading to uncertainty about further rate declines. Average earnings for eco-designed VLCCs were reported at $39,700 per day, with varying rates for different routes. Despite the market's decline, some high-profile fixtures were secured, with the highest rate of the week being $60,685 per day for a voyage from the US Gulf to South Korea.

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[SLOW] EIA - Crude Oil Outlook _ US SPR crude oil inventory outlook

US buys 2.5 million barrels of oil to replenish Strategic Petroleum Reserve

The U.S. Department of Energy announced the purchase of nearly 2.5 million barrels of domestically produced sour oil to replenish the Strategic Petroleum Reserve (SPR) after its record sale in 2022. The oil, valued at over $180.3 million, will be delivered to the SPR's Bryan Mound site in Texas from January to March 2024. The Biden administration has been gradually replenishing the SPR, which was drawn down by 180 million barrels in 2022 to stabilize gasoline prices after Russia's invasion of Ukraine. So far, over 47 million barrels have been repurchased at an average price of $76.89 per barrel, significantly lower than the selling price in 2022.