Russian coal exporters are looking for other supply options, but they are costly and will take time to implement.
The export of coal from Russia by sea has actually stopped due to the impact of EU sanctions. Bloomberg reported this on the eve, citing sources of knowledge.
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According to them, Russia’s largest coal mining company Siberian Coal Energy Company (SUEK) has not been able to deliver fuel since mid-August.
This is due to the fact that the cargo insurance market is dominated by companies from the EU, UK and Switzerland, which makes it difficult for ship owners to find insurance companies.
EU sanctions against Russian coal and certain types of fertilizers, which began on August 10, apply not only to its purchase, but also to its transportation anywhere in the world.
Russia began diverting coal shipments to Asia before the EU ban took effect, but now shipowners, who tend to reinsure their risks with larger suppliers, can’t take over such exports.
Agency interlocutors said Russian coal exporters were looking for other options, but they would be costly and take time to implement. According to them, this will lead to a bigger price increase.
As Russia redirected its coal to Asia, including India, exporters such as Australia shifted volumes to Europe. This has led to an increase in prices, which have increased 10 times over the past year.
Russia is one of the three largest global exporters of coal, controlling approximately 17% of world supplies. The coal industry makes up only about 1% of the Russian economy.
Recall that on August 10, a complete ban on the import of Russian coal began in the EU. This measure was agreed upon in early April, as part of the fifth package of sanctions in response to Russia’s full-scale military invasion of Ukraine.
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Source: korrespondent
I am Dylan Hudson, a dedicated and experienced journalist in the news industry. I have been working for Buna Times, as an author since 2018. My expertise lies in covering sports sections of the website and providing readers with reliable information on current sporting events.