Polish Orlen used tankers carrying Russian oil to Asia, securing lower rates for Arab crude imports

As the foreign news outlet Reuters reports, Polish energy giant Orlen has used tankers in recent months that had delivered Russian oil to Asia. On their return journeys, the tankers then carried oil from Arab countries to Orlen’s refineries in Poland or Lithuania. This is said to have happened at least ten times. As a result, Orlen is able to transport oil at lower cost.

Many oil giants are distancing themselves from both imports of Russian oil and tankers associated with Russian oil because of Western sanctions. Using tankers that are not operated by Russian companies to transport Russian oil does not in itself violate the sanctions rules announced by the G7 (note: individual countries or blocs may impose, and do impose, additional restrictions; for example, the EU banned seaborne oil imports into the bloc). This is permitted provided they comply with the group’s price caps.

The price caps are intended to limit Russia’s revenue from oil sales. Russia is one of the world’s largest exporters, and its production cannot be replaced by other sources. It is also a major member of OPEC+, which further complicates the situation. The cap is set at 60 USD/bbl. The price of Brent crude is currently above 87 USD/bbl. India and China are taking advantage of the resulting supply of oil below market prices, as Russian oil exports have been redirected to these countries.