{"id":323462,"date":"2022-11-02T23:59:30","date_gmt":"2022-11-03T03:59:30","guid":{"rendered":"https:\/\/www.sgtreport.com\/?p=323462"},"modified":"2022-11-02T03:57:17","modified_gmt":"2022-11-02T07:57:17","slug":"hoot-of-the-day-russian-oil-gets-to-us-via-sanction-loophole","status":"publish","type":"post","link":"https:\/\/www.sgtreport.com\/2022\/11\/hoot-of-the-day-russian-oil-gets-to-us-via-sanction-loophole\/","title":{"rendered":"Hoot of the Day: Russian Oil Gets to US Via Sanction Loophole"},"content":{"rendered":"<p><em>by Mish Shedlock, <a href=\"https:\/\/mishtalk.com\/economics\/hoot-of-the-day-russian-oil-gets-to-us-via-sanction-loophole\" target=\"_blank\" rel=\"noopener\">Mish Talk<\/a>:<\/em><\/p>\n<p><img decoding=\"async\" class=\"alignleft\" style=\"width: 35%;\" src=\"https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_700\/MTkzNDQ1MjgwMDM1NjQ1MTE3\/hoot-of-the-day-russian-oil-gets-to-us-via-sanction-loophole.webp\" alt=\"\" \/>I describe the roundtrip process in which Russian oil refined in Italy makes its way to to the US. It&#8217;s a real hoot.<\/p>\n<p>The Wall Street Journal has an interesting video that describes\u00a0<a href=\"https:\/\/www.wsj.com\/video\/series\/in-depth-features\/russian-oil-is-fueling-american-cars-via-sanctions-loophole\/FB87120B-1DA2-40EA-A518-61CC9E2B409F\" target=\"_blank\" rel=\"noopener\">How Russian Crude Avoids Sanctions and Ends Up in the US<\/a>.<\/p>\n<p>With an upfront ad, that is a free WSJ video link.<\/p>\n<p><strong>The Lukoil Connection<\/strong><\/p>\n<p><!--more Read More--> TRUTH LIVES on at\u00a0<a href=\"https:\/\/sgtreport.tv\/\" target=\"_blank\" rel=\"noopener noreferrer\" data-auth=\"NotApplicable\">https:\/\/sgtreport.tv\/<\/a><\/p>\n<p><img decoding=\"async\" src=\"https:\/\/mishtalk.com\/.image\/t_share\/MTkzNDQ1MjgwMDM1NjQ1MTE3\/hoot-of-the-day-russian-oil-gets-to-us-via-sanction-loophole.png\" alt=\"Image composite from WSJ video below\u00a0\" \/><\/p>\n<div class=\"m-detail--body-item m-detail--body-item-inline\">\n<figure class=\"l-inline tml-image m-detail--tml-image--inline\"><figcaption>\n<p class=\"tml-image--caption\"><em>Image composite from WSJ video<\/em><\/p>\n<\/figcaption><\/figure>\n<\/div>\n<p><strong>Sanction Avoidance Process\u00a0<\/strong><\/p>\n<ul>\n<li>US sanctions are on crude oil, not refined products.<\/li>\n<li>Lukoil, Russia&#8217;s second largest oil and gas company was not sanctioned by the US.<\/li>\n<li>Lukoil&#8217;s refinery in Sicily is the second largest in Italy and fifth largest in Europe.<\/li>\n<li>A Lukoil refinery in Italy once processed crude from multiple countries. Now it inputs are 93 percent from Russia.<\/li>\n<li>After refining, the country of origin is Italy, not Russia. This is due to longstanding practice of changing the country of origin to where oil is refined.<\/li>\n<li>The refined product then makes its way Exxon and Lukoil plants in New Jersey and Texas.<\/li>\n<li>Lukoil still has a gas station presence in the US and it distributes products to eleven states.<\/li>\n<\/ul>\n<aside class=\"m-in-content-ad-row l-inline mm-in-content-ad-row--in-content not-size-a not-size-b not-size-d\" data-ad-group=\"in_content-0\">\n<div class=\"m-in-content-ad not-size-a not-size-b not-size-d\" data-ad-group=\"in_content-0\" data-zone-count=\"2\">\n<div class=\"not-size-a not-size-b not-size-d m-in-content-ad is-loaded\"><\/div>\n<\/div>\n<\/aside>\n<p><strong>Lukoil Stations in 11 US States<\/strong><\/p>\n<div class=\"m-detail--body-item m-detail--body-item-inline\">\n<figure class=\"l-inline tml-image m-detail--tml-image--inline\"><a><picture class=\"is-loaded\"><source srcset=\"https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_380\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.webp 380w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_620\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.webp 620w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_1240\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.webp 1240w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_700\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.webp 700w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_1339\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.webp 1339w\" type=\"image\/webp\" sizes=\"(min-width: 1240px) 700px, (min-width: 675px) 620px, calc(100vw - 40px)\" \/><source srcset=\"https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_380\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png 380w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_620\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png 620w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_1240\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png 1240w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_700\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png 700w, https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_1339\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png 1339w\" sizes=\"(min-width: 1240px) 700px, (min-width: 675px) 620px, calc(100vw - 40px)\" \/><img loading=\"lazy\" decoding=\"async\" class=\"m-detail--tml-image m-image\" src=\"https:\/\/mishtalk.com\/.image\/t_share\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png\" srcset=\"data:image\/gif;base64,R0lGODlhAQABAIAAAAAAAP\/\/\/yH5BAEAAAAALAAAAAABAAEAAAIBRAA7\" alt=\"Image composite from WSJ video\" width=\"1339\" height=\"729\" data-src=\"https:\/\/mishtalk.com\/.image\/c_limit%2Ccs_srgb%2Cq_auto:good%2Cw_700\/MTkzNDQ1NjUwNzQ1MDA5Mzgw\/lukoil.png\" \/><\/picture><\/a><\/p>\n<div class=\"m-detail--tml-image-wrapper\">\n<div class=\"m-detail--tml-image-container\"><\/div>\n<\/div><figcaption>\n<p class=\"tml-image--caption\"><em>Image composite from WSJ video<\/em><\/p>\n<\/figcaption><\/figure>\n<\/div>\n<p>Note: Most of the 230 Lukoil gas stations in the US are owned by individual American franchisees, not the oil giant itself.<\/p>\n<p><strong>Understanding the Process<\/strong><\/p>\n<ul>\n<li>The US has sanction exclusions for oil &#8220;substantially transformed into a foreign-made product.&#8221;<\/li>\n<li>US refiners cannot process Russian crude, but Italian refiners can, then distribute the product here.<\/li>\n<li>In return, US can send its refined products to the EU, completing the round trip!<\/li>\n<\/ul>\n<p>Lukoil is 6th largest refiner in Europe.\u00a0It went from processing 30% Russian oil to 93%.\u00a0That&#8217;s a pretty big sieve even if amounts to US are small.<\/p>\n<p>Conveniently timed for the US election, European bans on Lukoil do not come into play until December 5.<\/p>\n<p><a href=\"https:\/\/mishtalk.com\/economics\/hoot-of-the-day-russian-oil-gets-to-us-via-sanction-loophole\" target=\"_blank\" rel=\"noopener\"><strong>Read More @ MishTalk.com<\/strong><\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>by Mish Shedlock, Mish Talk: I describe the roundtrip process in which Russian oil refined in Italy makes its way to to the US. It&#8217;s a real hoot. The Wall Street Journal has an interesting video that describes\u00a0How Russian Crude Avoids Sanctions and Ends Up in the US. With an upfront ad, that is a [&hellip;]<\/p>\n","protected":false},"author":6,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[],"tags":[141384],"_links":{"self":[{"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/posts\/323462"}],"collection":[{"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/users\/6"}],"replies":[{"embeddable":true,"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/comments?post=323462"}],"version-history":[{"count":0,"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/posts\/323462\/revisions"}],"wp:attachment":[{"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/media?parent=323462"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/categories?post=323462"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.sgtreport.com\/wp-json\/wp\/v2\/tags?post=323462"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}