Germany’s Schwedt struggles to compete with Russian oil
Germany’s Schwedt oil refinery reported low earnings, highlighting the difficulties the country faces. Berlin refused to use Russian oil. Instead, it plans to look for alternative suppliers. Poland joined Germany in this endeavor. They have not been able to meet the demand.
Historically, Schwedt supplied 90% of Berlin’s gasoline, fuel oil and jet fuel. After three months of cooperation between the German government, Warsaw and Schwedt, the refinery is now operating at 50-60% capacity. Meanwhile, those alternative supplies still haven’t appeared.
Last month, Russia retaliated against the two European countries’ bilateral efforts. Moscow stopped oil flow to Poland via the Druzhba pipe and halted its delivery. As a result, Poland now can’t free up a sufficient amount of oil for Schwedt. PKN Orlen (a Polish state-controlled oil refiner) has to use more capacity in the Gdansk oil terminal. In another case, it won’t be able to feed its own Plock refinery.
Schwedt is limited to one tanker slot per month in Gdansk. That’s approximately 1 million metric tonnes of oil per annum. Unfortunately, that…