Exclusive: Turkey saves $2 billion on Russian oil as imports soar despite sanctions

Source:Reuters Date:18Dec2023

Turkey became the biggest importer of Russian energy in the Western hemisphere after Russia’s invasion of Ukraine triggered European countries to halt most imports of Russian oil and gas. China and India have imported larger volumes from Russia than Turkey, but Ankara’s proximity to Russian ports, however, means it is saving more than other buyers thanks to cheaper freight.

Supplies to Turkey are expected to rise further in the coming months after private Russian oil producer Lukoil signed a deal with Azeri firm SOCAR to refine up to 200,000-barrel-per-day of its oil at Socar’s Turkish STAR refinery, trading sources said.

Turkey has been paying between $25 and $150 less for a ton ($3.3-20 per barrel) of Russia diesel this year compared to prices for similar grades in the Mediterranean, according to traders. For crude, it had discounts of between $5-20 per barrel. Cheaper energy imports have helped Ankara narrow its trade deficit and lessen pressure on its currency, which devalued 30% so far this year.