More Caspian oil can flow into Mediterranean Sea after Russia’s retreat
Azerbaijan, Baku, Dec. 9 /Trend A.Badalova/
Russia is restructuring its exports at the expense of the Mediterranean Sea market and is not in a position to promote any pipeline bypassing the Bosporus Strait, Energy Security Analysis (ESAI) expert Andrew Reed believes.
He believes that Russia's retreat from the Mediterranean Sea will create an opportunity for more Caspian light sweet crude to flow into that market.
"For the foreseeable future, Russia's oil company Transneft has its hands full filling new capacity in other directions," Reed told Trend via e-mail.
Transneft is a partner in Burgas-Alexandroupolis (Trans-Balkan pipeline) project, which is designed for oil supplies to the Mediterranean Sea. This aims at ensuring Russian oil supplies to the Greek port of Alexandroupolis through Bulgaria, bypassing Turkey's Bosphorus Strait.
An agreement on the construction of the Burgas - Alexandroupolis oil pipeline was signed between Russia, Greece and Bulgaria on March 15, 2007. The oil pipeline was supposed to pass from the Bulgarian city of Burgas on the Black Sea coast to the Greek Alexandroupolis on the Aegean Sea coast.
This week the implementation of this project faced a big problem - Bulgarian Finance Minister Simeon Djankov said Bulgaria terminates participation in project.
Reed believes that it makes no sense for Transneft to invest in infrastructure if Russia's exports from the Black Sea are on the decline.
Reed said that in 2012 Russia will increase crude oil exports from the Baltic Sea, then complete the extension of the ESPO (Eastern Siberia Pacific Ocean) Pipeline and increase oil exports to Oil Terminal in Kozmino Bay.
According to the recently ESAI's study, entitled Russia Comes of Age, in late 2011, Russia is adding 700,000 b/d of export capacity to the Baltic Sea, where it already exports 1.5 million b/d of oil. At the end of 2012, the capacity of the ESPO Pipeline to Kozmino Bay will be doubled to 600,000 b/d.
The decrease in Russian volumes to the Med will reduce congestion in the Bosporus Strait, ESAI's study says.