Russian oil shipment enters Ghanaian waters as EU sanctions disrupt traditional buyers

A cargo of Russian oil is reportedly heading for storage tanks in Ghana, marking a potential shift in the country’s oil import dynamics.

This development comes as European Union (EU) sanctions continue to bite into Russia’s oil industry, with almost all seaborne imports from the country having been halted in December 2022.

The move could signal traders scouring the market for new buyers of Russian barrels as Moscow finds itself increasingly reliant on Chinese and Indian purchases.

The tanker Theseus, carrying roughly 600,000 barrels of Russian oil, arrived in Ghana’s territorial waters on Friday, according to tanker tracking data compiled by Bloomberg. The cargo is expected to be pumped into storage tanks in Tema, according to individuals familiar with the matter. The last signal from the vessel was on Sunday evening, by which time unloading had not begun.

Russia’s energy industry has been under intense pressure after the EU and the Group of Seven (G7) imposed a series of punitive sanctions.

These measures have restricted almost all EU companies from buying Russian crude and petroleum products, or offering services such as insurance to nations that purchase such exports above a capped price. This has severely impacted Russia’s oil revenue, which fell almost 20% in December 2022 from the previous month, according to the International Energy Agency.

With almost all of Europe previously being the largest market for Russian oil, the sanctions have severely narrowed the country’s pool of buyers. As a result, barrels of Russian oil must be discounted at the point of export to compensate for relatively high delivery costs.

The shipment of Russian oil to Ghana is particularly noteworthy, given that the West African nation itself is a small oil exporter, shipping an average of about 140,000 barrels a day over the past six months, according to tanker tracking data compiled by Bloomberg. Moreover, Ghana is located close to two major oil suppliers in sub-Saharan Africa, namely Nigeria and Angola.

The crude will be stored at the Tema Oil Refinery, according to the individuals familiar with the matter. However, the company has not yet responded to requests for comment.

This shipment will be the first time Russian oil has been delivered to a West African country since at least October 2018, according to tracking data.

It is worth noting that the CEO of Ghana’s National Petroleum Authority (NPA) had initially indicated that the shipment would be blocked if it was bound for the country. However, the NPA did not respond to multiple requests for comment after the tanker reached Ghana’s territorial waters.

Overall, this development underscores the extent to which Russia is having to seek out new markets for its oil exports in the face of increasing international sanctions.

It also highlights the potential for shifts in oil import dynamics across regions, as smaller oil exporters such as Ghana potentially become important buyers of Russian oil.