Russian gasoline is embarking on a "global adventure"

When the fluctuations in international oil prices grip the nerves of the world, a little - noticed undercurrent of trade is quietly surging. According to industry data, in 2023, the volume of entrepot trade in Russian gasoline increased by 47% year - on - year. What kind of market logic lies behind this "round - about transportation" mode? This article will uncover the "smoke and mirrors" of this energy trade.

The price arbitrage space is the primary impetus for entrepot trade. Due to the long - standing regional price differences, Mr. Zhang, a Middle - East trader, revealed: "The profit per ton of 92 - octane gasoline transiting through a third country can be $15 - 20 higher than that of direct exports." This arbitrage behavior has given rise to complex logistics chains:

• The "Mediterranean Corridor" from Russia to Turkey to North Africa
• The "Indian Ocean Passage" from Russia to the UAE to East Africa
• The "Malacca Route" from Russia to Singapore to Southeast Asia

In the entrepot trade ecosystem, shipping intermediaries play a central role. Ms. Li's ship - brokering company has handled the entrepot business of over 30 oil tankers this year. She said: "Ship - owners now prefer to sign the 'optional destination' clause, which provides operational flexibility for entrepot trade." It is worth noting that:

• 50% of the entrepot - trading oil tankers change their flags more than twice
• About 35% of the transactions are settled using "back - to - back letters of credit"
• On average, each batch of goods undergoes 3 - 4 changes of ownership

This trading mode is reshaping the regional energy landscape. Due to the impact of entrepot - traded gasoline, the operating rate of a refinery in Southeast Asia has dropped to 65%. Professional institutions predict that in 2024, entrepot trade may give rise to two new forms:

• The compliant entrepot trade of blended fuels
• The "decentralized" trading network for digital currency settlement

As the "cat - and - mouse game" in energy trade continues to escalate, are we witnessing the failure of traditional trade rules? Welcome to share your insights in the comment section, or click "Like" to invite more peers to join this discussion on the future of energy trade.