Russia's Taman port set to suspend LPG exports over drone danger

Russia's Black Sea port of Taman is poised to suspend exports of highly-explosive liquefied petroleum gas (LPG) because of concerns linked to drone attacks, three sources with knowledge of the situation told Reuters on June 2.

Russia has come under repeated attack in recent weeks, suffering a major cross-border incursion and drone attacks including on Moscow, oil refineries in southern Russia and a fuel depot near a strategic bridge that links Russia's mainland with Crimea, Reuters reports.

Russia says Ukraine was behind the attacks, including on the Kremlin last month. Kyiv denies it.

Rail operators in Russia and Kazakhstan have already declared plans to restrict cargo shipments towards Taman, which accounts for around 7.5% of Russia's total LPG exports.

Three sources with direct knowledge of the situation told Reuters that Taman will suspend handling of LPG, also referred to as propane and butane, because of the explosive nature of the fuel. All the sources spoke on condition of anonymity due to the sensitivity of the situation.

"Taman is suspending LPG transhipment as it is dangerous after all those (drone) attacks - the gases are most explosive," one of the sources said.

The sources did not specify when the port would stop handling LPG, saying existing stockpiles would be shipped first.

Tamanneftegaz, the operator of the Taman transhipment complex, which also handles crude oil and oil products, did not respond to a request for comment.

The concerns over drone attacks on Russian infrastructure are the latest instance of how the conflict in Ukraine affects energy supplies and how dependent they are on security in the Black Sea through which Russia sends fuel to world markets.

LPG is mainly used as fuel for cars, heating and to produce other petrochemicals.

Two of the sources said LPG operations at the Taman transhipment complex, which has a capacity of 20 million tonnes of cargoes per year, would be mothballed indefinitely.

According to the available data, railway supplies of LPG to Taman from Russia's and Kazakhstan's suppliers stood at 192,000 tonnes in January - May. Last year the complex shipped 328,000 tonnes of Russian and Kazakh LPG.

The sources said that the complex was for now handling LPG cargoes from stockpiles in the port.

"They will stop it," one of the sources said. Other market sources said they were studying other routes for LPG exports from Russia, including Poland and China.