HomeMediaLatest NewsHow Europe finds new coal suppliers, and Russia finds new customers

How Europe finds new coal suppliers, and Russia finds new customers

02 August 2022

Titov Alexander V. Head of the Global Oil Market Sector, Energy Department
Тема: Energy

Alexander Titov commented to Forbes on the redistribution of coal supplies under the embargo.

It will not be possible to reorient supplies to the East. Japan announced in April that it would waive coal imports from Russia, although it did not announce any specific plans or timetable for the waiver. According to Alexander Titov, a senior expert at the Institute for Energy and Finance, Japan and South Korea, another major buyer of Russian coal, cut supplies from Russia in April. “In the second quarter of 2022, the export of Russian coal to Japan and South Korea decreased by 17.2% compared to the previous quarter, and in July the average daily export decreased by another 25.3% compared to the level of the second quarter,” Titov told Forbes .

The Federal Customs Service has recently not disclosed export data, and the Ministry of Energy has closed the statistics page for reconstruction, so analysts rely on unofficial, mostly foreign, data, as well as data from non-public sources, which are not always the same. Titov says that direct coal exports from Russia to Europe have fluctuated around the level of 52,000 tons per day since the second half of April this year, which is 29% lower than the average level of January-March 2022 and 49% lower than April-July 2021.

Direct deliveries plummeted in April when Poland and Finland stopped importing Russian coal. Finland did not announce this directly, but on April 6, the Finnish railway company VR decided to completely stop rail freight traffic to and from Russia. At the same time, significant volumes of deliveries to France appeared, and in June-July Italy also increased shipments. Germany still retains some shipments and even increased them in July, when the reduction in gas supplies via Nord Stream began. The UK maintained and even increased the volume of supplies from Russia, despite the negative rhetoric, however, the overall decrease in direct coal supplies from Russia to Europe compared to January-March 2022 was not offset.

Europe is actively trying to find new coal suppliers. The key countries that are replacing Russia are South Africa, Australia and partly Colombia, Titov says. “But many experts note that the task of replacing Russia is far from over, and difficulties with gas imports from Russia only exacerbate the situation,” Titov said. “This will keep European coal prices at high levels well into the second half of 2022.”

Titov Alexander V. Head of the Global Oil Market Sector, Energy Department
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