Germany says it won’t be buying Russian oil at all in 2023

Germany rejected a claim that it plans to buy Russian oil early next year, saying that it will instead import crude oil from Kazakhstan. 

Europe’s largest economy has said previously it plans to halt imports of Russian crude by the end of this year after the Kremlin’s invasion of Ukraine. However, that was thrown into doubt when the chief executive of Russia’s oil pipeline operator said it had received requests for supplies in the first quarter of 2023.

German refineries Leuna and Schwedt have historically been dependent on piped Russian oil imports. Now, flows along the Druzhba pipeline — Europe’s largest conduit for crude — will be from Kazakhstan instead, though that agreement hasn’t been finalized yet.

“Reports that Germany had ordered Russian crude oil are false,” a spokeswoman for the German economy ministry said. “The mineral oil companies at the Leuna and Schwedt refineries will no longer be ordering Russian crude oil in the new year.”

The PCK refinery in Schwedt, near the Polish border, has “reserved capacities for Kazakh oil in the pipeline system” as of January, she added.

Pipeline oil flows from Russia are exempt from the European Union’s ban on most seaborne imports, which started on Dec. 5. Germany and Poland, which receive Russian crude via the northern leg of the Druzhba link, pledged to wean themselves off by December. 

“They announced they wouldn’t take oil from Russia from Jan. 1, but we’ve received requests from Polish consumers: give us 3 million tons for next year and 360,000 tons for December,” Transneft’s CEO Nikolay Tokarev said in an interview with state-owned TV channel Rossiya 24 earlier on Tuesday. “Germany has already sent a request for the first quarter — give us, too.”

It would be difficult for German refineries to replace all Russian volumes with Kazakh crude, Tokarev said, adding that while technically it’s possible to conduct so-called swap operations to partially replace Russian oil, it’s a political decision.

Kazakh Shipments

The Central Asian nation could send two to five million tons a year by pipeline, Kazakh Foreign Minister Mukhtar Tileuberdi said last week.

Kazakh crude is pumped to Samara in Russia, blended with Russian supplies and exported through the ports of Ust-Luga and Novorossiysk. Cargoes owned by Kazakhstan’s KazTransOil, which are now branded as KEBCO to distinguish them from Russian-owned REBCO, are exempt from EU sanctions and the oil could be diverted from the ports into the Druzhba pipeline, but that would require the participation of the Russian pipeline operator. 

“There are no talks with us about Kazakh oil flows going through Russia, Belarus and Poland to Germany,” Transneft spokesman Igor Dyomin told Bloomberg by phone after Germany’s statement. “No contracts were signed.”

The Polish request to Transneft was “standard procedure” to book potential transit capacity, the nation’s refiner, PKN Orlen, SA said last month. The company is ready to stop imports of Russian oil, but it needs government decisions for that to happen.