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Oil exports from Ceyhan poised to fall on Turkmen flows diversion - sources

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By Olga Yagova and Gleb Gorodyankin

MOSCOW (Reuters) – Azeri BTC oil exports from the Turkish port of Ceyhan are set to decline after Turkmenistan diverted its oil flows to Russia, which may also have a negative impact on the Azeri BTC blend quality, traders and industry sources said.

The expected decline of exports from Ceyhan comes as exports of Turkmen oil via Russia’s Black sea port of Novorossiisk will resume in February.

Relations between Moscow and Ashgabat have been strained after Russia, once the biggest buyer of Turkmen gas, halted purchases in 2016.

Turkmenistan stopped transit of its oil via Russia the same year and has been exporting all its crude via the Azeri Caspian port of Baku.

However, Russian President Vladimir Putin has sought to forge closer ties with ex-Soviet Turkmenistan and has been on friendly terms with his Turkmen counterpart Kurbanguly Berdymukhamedov.

According to traders, supplies from Turkmenistan to Baku-Tbilisi-Ceyhan (BTC) pipeline may decline already next month, while in March they are likely to completely dry out.

Azeri energy firm SOCAR, BTC and Russian oil pipeline monopoly Transneft did not immediately respond to requests for comment.

Traders and industry sources say Turkmenistan’s decision to divert its oil to Russia could be explained by more profitable transportation tariffs.

Currently, over 200,000 tonnes of light and low sulphur oil per month from Turkmenistan is being supplied to the BTC pipeline.

BTC, which ships oil from the Azeri, Chirag and Guneshli oilfields operated by BP, has a capacity of around 1 million barrels per day, while actual supplies have been about 70 percent of that.

(additional reporting by Nailia Bagirova in Baku; wtiting by Vladimir Soldatkin; editing by Emelia Sithole-Matarise)

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