Russia's New Export Routes Leave Czechs Short of Oil

Russian oil deliveries to the Czech Republic for the month of April will decline by 80 percent, Reuters reported April 9. Sources within Russia's LUKoil confirmed the company would not ship any oil to the Czech Republic from April to June, and Rosneft announced significant reductions over the same period. The oil that typically would go to the Czech Republic has been redirected through the recently opened Baltic pipeline (BPS-2) and shipped out via the Ust-Luga port.

Russia is diversifying its oil export routes from its traditional pipeline system to reach export terminals in the Baltic states, allowing it to send its oil to the most profitable markets (and politically important customers). However, this exposes countries on more traditional (and less profitable) transit routes in Central and Eastern Europe to oil shortages. The smaller amount of oil being sold to the Czech Republic for the next few months is the first example of this shift.