The countries that have shorelines along the Baltic sea are diverse in size, economic might and of course energy use and storage but most of them have one thing in common: a strong reliance on Russia for much of their oil and gas
needs. Vaughan O’Grady reports
Of all the countries that have shorelines along the Baltic sea, Germany has perhaps the most developed systems for internal transport and storage of oil. But it is also proposing an Energiewende, a planned transition to a low-carbon, environmentally sound energy supply with the promotion of alternatives to petrol such as electric cars.
Does government promotion of this transition mean a diminished market for oil in Germany? Well, electric cars are not yet the norm.
Frank Schaper, managing director of Germany’s UTV Unabhängiger Tanklagerverband e.V (Independent Tank Storage Association), says: ‘Of course you see increasing numbers of charging columns and stations, but the absolute numbers are still very small.’
However, despite the Energiewende as well as the ban of older diesel cars in big cities such as Hamburg, Stuttgart and Frankfurt, Schaper says that even diesel remains relatively healthy.
In fact, the figures paint a fairly encouraging picture for fossil fuels in Germany. Based on the yearly report of the Mineralölwirtschaftsverband eV (MWV), the association representing the oil industry in Germany, the 2017 German consumption of gasoline was 18.3 million tonnes (2016:18.2), of diesel 38.7 million tonnes (37.9) and of heating oil 15.8 million tonnes (15.8). Jet fuel (Jet A1) consumption was 10.0 million tonnes compared to 9.2 million tonnes in 2016.
Germany is still a net importer of middle distillates and a net exporter of gasoline. The production of middle distillates – including jet fuel – in 2017 was 51 million tonnes (against a consumption of 56 million tonnes). Gasoline production in 2017 was 21 million tonnes (against a consumption of 18 million tonnes).
As for what this means for storage, Schaper explains: ‘The effect on the tank storage sector is relatively small and mainly affects the terminals along the North Sea and Baltic coast and to a lesser extent the smaller inland terminals along the Rhine.
‘The main function of the German tank storage sector is the distribution business and participation in the compulsory stock obligation.’ Contango and backwardation are therefore much less relevant here than in some markets.