Russia’s dirty oil crisis is worse than almost anyone predicted

The length and scope of the crisis on Druzhba pipeline and contaminated Russian oil has given it a political dimension, Report informs referring to Bloomberg.

"Russian oil officials talk about 20 million barrels contaminated, but oil traders and refining executives believe the real number may be closer to 40 million’.

The larger the amount, the bigger the problem: the polluted crude will need to be blended very slowly to bring the chloride levels down to acceptable levels, on a 1-dirty-to-10-clean barrels ratio most likely. That process may well take months, not weeks. So far, refiners in Poland have experimented with blending and struggled.

On the background of problem related to Russian oil, in Germany, one of the continent’s biggest refineries — the Leuna plant owned by French oil giant Total SA — was shut down. Poland has been forced to tap the emergency petroleum reserves. And as far west as Rotterdam, Europe’s petroleum hub, some refineries have been forced to run at lower rates.

Speaking privately, more than a dozen oil traders and refining executives in London, Geneva and Moscow said the cost may reach $1 billion. The estimates are based on the volume of oil contaminated and the $10-to-$20-a-barrel discounts refiners are asking to take the tainted barrels.