Taiwan imports record amounts of Russian naphtha - BNN Bloomberg

(Bloomberg) — Taiwan’s petrochemical industry imported record amounts of Russian naphtha in October, bringing new supplies from an oil refinery thousands of miles away.

The island nation imported nearly 114,000 barrels of Russian naphtha per day last month, accounting for 66% of total imports of the commodity for the month, data from energy analytics firm Kpler showed. The increase – to a record high – consolidates Russia’s position as a top supplier to Taiwan, a position previously held by the United Arab Emirates.

The increase in October is mainly driven by a recent start-up of a third condensate splitter at Novatek PJSC’s Ust-Luga refinery, said Viktor Katona, chief crude oil analyst at Kpler. So far this year, Taiwan has been the destination for as much as 78% of all Novatek’s monthly naphtha exports from the Baltic Sea port, Kpler figures show.

Russian fuel producers have expanded their presence in Asia and Latin America after Western countries and their allies, previously the main consumers of Russian oil products, banned imports from early 2023 in response to the invasion of Ukraine.

Ust-Luga extension

Novatek’s Ust-Luga refinery processes condensate, a very light type of oil. It brought a third splitter online in mid-August, allowing larger naphtha flows, Katona said.

As a result, the plant increased processing volumes to an all-time high of more than 195,000 barrels per day in the second half of August and early September, compared to about 140,000 barrels per day in the previous months, industry data from Bloomberg shows.

This increase coincided with a jump in Russian naphtha exports to Taiwan. It takes about 60 days for Ust-Luga’s cargoes to reach the Asian country.

Shortly after the third splitter came online, Novatek began servicing at least one of the original units, temporarily halting production at the plant, Bloomberg industry data shows.

“Novatek’s plant in Ust-Luga has less than a month left in which all three splitters are running at full capacity,” said Katona. “Once that happens in December or January, Russian flows to Taiwan could easily remain above 100,000 barrels per day on a sustainable basis.”

Novatek did not respond to a Bloomberg request for comment on the Ust-Luga refinery’s maintenance schedule and production levels.

–With help from Prejula Prem.