The OPEC nations that have stepped up to replace Russian oil flows to Europe aren’t the giants of the Middle East. Instead, some of the group’s minor players are helping to fill the gap.
Within the cartel, West African producers are showing the biggest uptick in shipments to European ports, where refiners are snubbing Russian supplies following the invasion of Ukraine.
Meanwhile, Saudi Arabia and the United Arab Emirates — two of the biggest producers in the Organization of Petroleum Exporting Countries — have largely refrained from additional shipments to Europe, despite their abundant spare production capacity.
Average shipments of West African crude to Europe reached 1.23 million barrels a day in March and April, up by 40% from the same period last year and the highest level since February 2020, according to tanker-tracking data compiled by Bloomberg.
That jump comes despite Nigeria and Angola, the region’s main producers, struggling to increase production as they wrestle with diminished capacity, reduced investment and operational outages. With output under strain, the increase in sales to Europe has come at the expense of a 20% drop in the region’s traffic to Asia.
To be sure, the US has been the overall top supplier replacing Russian volumes in Europe. And if the European Union proceeds with plans for a full ban on Russian supplies, the African nations may not have much more to give. That could present OPEC’s Persian Gulf heavyweights — apparently unwilling to encroach on Moscow’s European customer base so far — with an opportunity too tempting to resist.
–With assistance from Alex Longley.
© 2022 Bloomberg L.P.
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