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KUWAIT CITY, Sept 28: Bloomberg Agency said that Gulf countries are shipping large quantities of diesel to Germany, the largest European economy, to compensate for the interruption of Russian supplies of oil and gas to Europe early next year, pointing out that the UAE is also ready to help continue the fl ow of diesel to the continent, reports Al-Qabas daily. In a recent report, the agency said the intensification of production of two new giant refineries, “Az-Zour Kuwait” and Saudi Arabia’s Jazan, may lead to a significant increase in diesel flows to Europe. The agency did not confirm the quantities of diesel that the Kuwaiti and Saudi refineries might produce, but it revealed that the German “Wilhelm Heuer” company will receive about 250,000 tons of diesel per month in 2023, from the Abu Dhabi National Oil Company (ADNOC), equivalent to two-thirds of the seaborne diesel imports that Germany received from Russia last year.
The report stated that Russia is the largest foreign supplier of diesel to Germany and the European continent as a whole, despite the increasing tensions with the European Union after Moscow’s invasion of Ukraine, pointing out that gas and diesel shipments from Russia are scheduled to stop early next February, due to the embargo imposed by the European Union on Russia’s imports of oil and the gas transported by sea, which forced European oil traders to intensify the operations of obtaining oil and diesel from other countries, especially from the Gulf.
Mark Williams, director of oil research at Wood Mackenzie, said that the high profits from converting crude oil to refined oil products will motivate ADNOC to export more barrels of oil and diesel to Europe via Africa and Asia. He expected the global trade fl ows of oil and its products to change in a structural form when the European Union’s ban on Russia’s oil imports comes into force next year.
Williams went on to say, while ADNOC can obtain oil products from the larger market, it is likely to export quantities from its Ruwais refinery, or it may use Middle Eastern countries due to the excess oil supply in the region and its proximity to Europe. The Wilhelm Heuer said the delivery of the first oil deal from the region is already underway, as a shipment estimated at 33,000 tons of diesel is unloaded in the port of the German city of Hamburg, and indicated that further talks will be held to expand cooperation with several oil producing countries, including the Gulf states. German Chancellor Olaf Schultz recently visited Abu Dhabi as part of a Middle East tour, in his country’s quest to obtain high quality diesel products to face the cold winter in Germany.