September 5, 2022

Tracking Russian crude flows, dark vessel activities, diversions and distressed cargoes amidst sanctions

As the Russian invasion of Ukraine continues, economic sanctions have been progressively imposed on the country in retaliation to its military aggression. Sanctions against the country's crude exports are no exception especially when Russia is one of the top exporters of crude oil.

Amidst the sanctions from the United States and Western allies, increased attention has been placed on Russian crude flows, especially on the reshuffling of their voyages and potential diversions or distressed cargoes. At Kpler, the market data analyst team uses a combination of proprietary data, tracking algorithms, market information, port reports and a robust methodology to track these evolving flows.

Tracking Russian crude flows

At Kpler, crude flows are tracked on a vessel-by-vessel basis, which are aggregated using different data sources. These different data sources include AIS data, vessel lineups and reports from shipping agencies. AIS data indicates the next destinations of vessels based on what the ship captain declared as the next port while vessel lineups and reports provide information on which vessels are scheduled to load from a certain port and discharge at a particular port.

These pieces of information are combined to provide a forward-looking view of the vessels that are scheduled to load at the given port and to validate if a vessel had truly loaded from a given port. To accurately track Russian crude flow, Kpler uses these multiple sources of information to accurately track each individual vessel that is loading from the respective Russian ports.

The accuracy of our tracking methodology is further validated through the backtest of Kpler’s total Russian crude oil exports against the figures published by the Ministry of Energy of Russian Federation (MINERGO). With a low percentage of deviation, it gives us a high level of confidence in our overall exports tracking methodology.

Gaining Insights via Kpler: Reshuffling of Russian crude voyages from Europe to Asia

Kpler’s data enable users to spot emerging trends and patterns in real time to gain agile information on the quickly evolving global oil flows. Using Flows data on the terminal, Russian crude cargoes have shown a clear shift in their destinations from Europe to Asia, notably to India and China, since late February following the invasion. Users can also easily toggle between different views and filter modes to suit their needs.

 Russian Federation monthly exports (Crude/Co, by destination country) in kbd

Gaining Insights via Kpler: Changing ship-to-ship operations for Urals flows

Besides viewing the data through Kpler’s terminal, users can also access Kpler’s data via API/SDK or Excel Add-In for deeper analysis. The example below is the use of the STS (Ship-to-Ship) query through the Excel Add-In for Urals. Using this simple query, we are able to analyze the change in the STS patterns for Urals flows.

Applying some analysis on the data retrieved on 31 August 2022, we observed an increase in STS operations for Urals flows, from an average of around 2 STS operations per month in 2021 (totaling to 30) to an average of around 11 (totaling to 93) since the start of January 2022. The increase in STS operations does not come as a surprise as these cargos are moving across longer distances to Asia and transferring of these cargos onto larger vessels for long haul voyage would be more economical.

There was also a shift in the locations where these STS operations were carried out. While most STS for Urals in 2021 occured at Frederikshavn Light, off the coast of Skaw at Denmark, these operations are being done at Ceuta Light, off the coast of Ceuta in the Mediterranean Sea, Europoort Light. 2 in Rotterdam and even in the North East Atlantic Ocean. Attributing to Kpler’s robust STS algorithm and AIS tracking methodology, we were able to track these obscure STS operations in the North East Atlantic Ocean (details below).

Excel Add-in Ship-to-Ship operations for Urals
Analyzing STS data via pivot table

Gaining Insights via Kpler: Tracking dark vessel activities involving Russian crude

The STS operation between Lauren II (IMO 9258521) and 1) ZHEN I (IMO 9255880), 2) Afrapearl (IMO 9330604), and 3) Amber 6 (IMO 9235713) occurred in the North East Atlantic Ocean where Lauren II received around 700k barrels of Urals from each of these three vessels.

Although the tracking of the STS operations between Lauren II, ZHEN I and Afrapearl were rather straightforward (as AIS information was available), the STS operation between Lauren II and Amber 6 required more analysis as Amber 6 had stopped transmitting its AIS signals and ‘went dark’ since 19 June 2022 after it had sailed into the North East Atlantic Ocean. Kpler was able to ascertain the STS operation between Lauren II and Amber 6 based on analyzing the vessels’ tracks and the change in their draught level. (Lauren II showed a positive draught change of 3 meters on 22 June 2022, indicating that it has loaded some cargo while Amber 6 also showed a negative draught change of 6 meters on 4 July 2022 after reappearing, indicating that it has discharged)

Based on AIS information, Lauren II was observed to have fully discharged the Urals cargo into Xian Ren Dao, China on 17 August.

STS tracks between ZHEN I (IMO 9255880) in blue and Lauren II (IMO 9258521) in orange around 26th May

STS tracks between Afrapearl (IMO 9330604) in blue and Lauren II (IMO 9258521) in green around 15th June

STS tracks between Amber 6 (IMO 9235713) in blue and Lauren II (IMO 9258521) in green around 20th June

The more obscure STS operation Kpler was able to identify at North East Atlantic Ocean was between Monica S (IMO 9292163) and 1) EMILY S (IMO 9321847), 2) Merope (IMO 9281891), and 3) Skadi (IMO 9230971) where Monica S was suspected to have received around 700k barrels of Urals from each of these three vessels. As compared to tracking the STS operation involving Lauren II, it was more challenging tracking the STS operations involving Monica S, EMILY S, Merope, and Skadi as all four vessels have gone dark, intentionally obfuscating their trading operations. EMILY S, Merope, and Skadi first appeared on our watchlist after they have signaled ‘Azores’ as the next destination. Subsequently, the three vessels stopped transmitting its AIS signals shortly after sailing into the North East Atlantic Ocean.

While all four vessels disappeared from view between 13 to 15 June 2022, EMILY S, Merope and Skadi reappeared some 5 days later, heading back towards Europe with negative draught change indicating that they had all discharged their cargo between these periods. Based on these observations, we were able to conclude the three vessels would have transferred their Urals cargo to Monica S. Monica S eventually discharged the cargo into China (according to industry reports & AIS information).

STS tracks between EMILY S (IMO 9321847) in blue and Monica S (IMO 9292163) in orange between 3 June 2022 and 25 June 2022

STS tracks between Merope (IMO 9281891) in blue and Monica S (IMO 9292163) in orange between 3 June 2022 and 29 June 2022

STS tracks between Skadi (IMO 9230971) in blue and Monica S (IMO 9292163) in orange between 3 June 2022 and 8 July 2022

Identifying Potential Diversions

To identify potential diversions following the invasion, we focus on the movement of vessels which entered into the Black Sea, Baltic Sea, Barents Sea and Japan Sea, as these are the seas where Russian seaborne crude is exported from. Automatic Identification System (AIS) data plays an important role here as they provide information relating to the vessel’s location, heading and speed among others. As Kpler uses multiple AIS sources, information relating to the vessel’s location is updated regularly allowing us to track vessels effectively. From the AIS data, some factors that would indicate a possible diversion would be the unexpected change in the vessel’s heading or clear deviation of the vessel's path and the change in the AIS destination.

For example, the Beijing Spirit (IMO 9418597) below loaded Russian crude in early March and, based on its AIS information and headings, she was expected to discharge this cargo into the United States. However, sometime after sailing through the Atlantic Ocean, it was observed that she had changed her heading and was sailing towards Europe instead, eventually discharging the cargo into Italy on 1 April.

Beijing Spirit (IMO 9418597) tracks between 8 March 2022 and 1 April 2022

Another example we have identified below is Suvorovsky Prospect (IMO 9522324). She had loaded Russian crude in May and based on its AIS information and headings, she was expected to head towards Vadinar, India. However, the vessel made a turn in the Mediterranean Sea before reaching the Suez Canal, eventually discharging this cargo into Sonatrach Augusta Refinery, Italy on 8 June.

Suvorovsky Prospect (IMO 9522324) tracks between 24 May 2022 and 8 June 2022

Identifying Distressed Cargoes

In order to identify distressed Russian cargoes, the market data analyst team keeps a close tab on vessels currently carrying Russian crude. Some indicators would include the number of days since the vessel has loaded the crude and the vessel’s movements.

Though we have yet to see any clear signs of distressed Russian cargo, we were able to identify some vessels which fit the bills. We have identified Minerva Alice (IMO 9309435) below where the vessel had loaded Russian crude in late January and based on its AIS information and headings, she was expected to discharge this cargo into the Caribbean. However, the vessel was seen to be idling off the shores of Cuba between late February and early April, showing some signs of distress before signaling and heading to India, eventually discharging on 25th May.

Minerva Alice (IMO 9309435) tracks between 27 January 2022 and 11 May 2022

While identifying and tracking these flows are important, Kpler also works towards understanding and uncovering insights beyond what is observable. To achieve this, the market data analyst team works closely with Kpler’s Insight Team by sharing these key information. The Insight Team, which consists of a group of seasoned analysts, digs deep into this information to produce reports, updates, and articles to provide users with actionable analysis and forecasts which are supported by Kpler’s proprietary data.

Given the uncertainty of the current climate and ongoing sanctions, it has become increasingly challenging to track Russian crude flows. However with the use of proprietary data, tracking algorithms, market information, port reports and a robust methodology, Kpler is well-equipped in tracking these flows and providing insights to our users.

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