This month, the Swiss-Dutch oil trader Vitol will start purchase of oil products from Turkmenistan, Reuters reported, citing sources familiar with the situation.
According to information, the world’s top energy and commodity trading company plans to deliver a test batch of 20,000 tons of fuel oil and 25,000 tons of diesel produced by the Turkmenbashi oil refinery. The oil products loaded at the international port of Turkmenbashi will go to the port of Makhachkala, and from there they will be delivered by rail to the Russian black sea port of Novorossiysk for seaborne exports.
Next year, if the logistics scheme offered by Vitol proves well, the volume of purchases from Turkmenistan may be increased to 500,000 tons.
Despite the fact that market analysts had predicted difficulties with the implementation of the deal due to the shortage of tankers in the Caspian sea, most of which are controlled by SOCAR, Vitol has succeeded and is now expanding its trade activities from the export of Turkmen crude oil to refined products.
The trader had to settle a number of issues related to negotiations with Russia’s railways, customs, fix vessels to cross the Caspian Sea.
Turkmenbashi refinery, as a rule, sells its products at annual tenders. Traditional buyers include Maddox, a trading firm affiliated with SOCAR, Dubai-based Turkmen Petroleum, Coral Energy and a number of other firms. And as traders note, the competition for Turkmen oil products is pretty tough.
The most of Turkmen oil products access the Black sea market through Azerbaijan and Georgian ports. Part of the deliveries are carried out through the Volga-don shipping channel, having no navigation from November to April.