Record Norwegian North Sea oil exports to help Europe fill Russian gap
(Bloomberg) — Record exports of Norway’s Johan Sverdrup crude oil are set to help meet European refineries’ needs as a deadline to phase out Russian supplies draws closer.
Loadings from the huge Johan Sverdrup field in the North Sea, operated by Norway’s Equinor ASA, will rise to 587,000 barrels a day in November, according to a program seen by Bloomberg. That compares with an average of 500,000 barrels a day in the first three quarters of this year.
The European Union’s planned sanctions on Russian seaborne crude are due to come into force in early December. While refineries have reduced the purchases of Russia’s Urals crude markedly since Moscow’s invasion of Ukraine, they still imported about 840,000 barrels a day of the flagship grade last month, according to ship-tracking data compiled by Bloomberg.
With the EU’s prohibition on Russian imports just two months away, Johan Sverdrup is regarded as a good replacement for Urals, mainly due to a similarity in quality. The grade, which is popular among Asian refiners, has increasingly been grabbed by European buyers in recent months.
Volumes of Johan Sverdrup are expected to rise further in coming months, with Equinor scheduled to start phase two production from the field in the fourth quarter. Nick Walker, chief executive officer of producing partner Lundin Energy, said earlier this year that the phase two will lift Johan Sverdrup production to about 755,000 barrels a day.
Exports of major five North Sea grades, used to set global benchmark Dated Brent, will also rise to a 10-month high of 780,000 barrels a day in November.