The UK is proposing to exempt Kazakh CPC Blend crude from sanctions against Russia, assuming no more than 15pc of Russian oil has been comingled into the blend, Argus understands.
A civil service task force, which represents the UK's Department for Business, Energy and Industrial Strategy (Beis), is looking to complete its legislative guidance by July. This is to facilitate the UK's pledge to phase out imports of Russian crude and oil products by the end of the year.
Argus understands the current working draft loosely characterises Russian oil as originating from Russia.
The UK proposal echoes the White House mandate that sanctioned imports of Russian crude and oil products to the US as of March, but does not affect CPC Blend.
The fate of the Kazakh crude has come under question, as the grade contains some Russian oil, transits a Russian pipeline and is exported from a Russian port in the Black Sea.
The exemption will allow UK refiners access to one of the few sour spot crude grades available within the region, as access to Russian Urals and Siberian Light is increasingly restricted. Argus tracking data indicate that 24,000 b/d of CPC blend out of 1.34mn b/d of total grade loadings headed to the UK in the first four months of this year.
UK buyers can otherwise resort to arbitrage imports, term crude grades from the Mideast Gulf, or to spot volumes of Iraqi Kirkuk blend sold by the Kurdistan Regional Government (KRG) loaded from the nearby Turkish port of Ceyhan. But some refiners shun KRG supplies, under pressure from Iraqi state marketer Somo, which is seeking to secure full marketing rights over Kirkuk blend from Erbil.
