The Russian oil industry may face huge losses, according to Bloomberg

© RIA Novosti / Maxim to Bogodeeva in photobacteria oil. Archival photoThe Russian oil industry may face huge losses, according to Bloomberg© RIA Novosti / Maxim to Bogodeeva the image Bank

The Russian oil industry will lose part of income after the entry into force in 2020 new rules of refueling ships, developed by the International Maritime organization of the UN (IMO), writes Bloomberg.

Under the new rules, ships need to be fuel with a sulphur content not more than 0.5% either install scrubbers — special cleaning devices. Now the threshold for the sulphur content of fuel used for fueling marine engines in most regions of the world is 3.5%.

Russia produced mainly Urals crude oil with high sulphur content. As of the end of September, the country has not produced fuel in compliance with the IMO standard, and more than two-thirds of the manufactured product had a sulfur content above 2.5%.

Despite the modernization of some enterprises, the Russian oil industry is unlikely to fully prepare for the introduction of new standards, and income from other variants of distribution of fuel with high sulfur content will not fully cover the loss, according to the authors of the article.

«The Russian oil segment is likely to be among those who will suffer the most from a financial point of view,» Bloomberg quotes senior analyst at IHS, Markit Ltd Alexander Shcherbakov.

The Agency estimated that last year Russia was rescued from the sale of petroleum fuels about nine billion dollars. According to the assessment of the investment Bank Wood & Co. Financial Services AS, in 2020 the loss of the country’s oil industry may reach $ 3.5 billion.

About the new rules announced in the middle of last year. IMO justifies the need of concern for the environment. Economists argued that the new rules will entail consequences: increased demand for cleaner burning fuel can lead to capacity utilization and the rise in prices of other petroleum products, including jet fuel.