Nicosia, Cyprus. Cyprus does not currently face a problem with its fuel stocks despite the Persian Gulf energy crunch, the Cyprus Mail reported. Former energy minister George Papanastasiou said the situation could change quickly.
Current assessment
“Right now we are fine, but it’s only a snapshot, things can change from one day to the next,” Papanastasiou said.
About 20 per cent of global oil consumption passes through the Strait of Hormuz in the Persian Gulf, which he said is now effectively closed. He added that Cyprus remains unaffected for now.
EU requirements and reserve calculation
Papanastasiou said EU law requires Cyprus to hold strategic oil reserves corresponding to 90 days of consumption. He said the 90 days is calculated based on consumption during the same timeframe in the previous year.
Storage responsibility and locations
He said the majority of the reserves, which are the responsibility of Kodap, the Organisation for Storage and Management of Oil Stocks, are held in Cyprus, with a small quantity stored abroad.
Physical stocks and ‘tickets’
Papanastasiou said strategic reserves include both physical stocks and ‘tickets’. He described tickets as contractual financial agreements in which a supplier agrees, for a fee, to hold or reserve a specified amount of oil on behalf of a buyer, allowing the buyer to meet legal emergency stock obligations without physically storing the products. He said tickets give the holder the right to access and buy specific volumes of oil during an emergency within a designated period.
Storage facilities and volumes
He said Cyprus’ strategic reserves are kept in storage facilities owned by Vttv, where he previously served as managing director. He added that Kodap is building its own storage terminal.
Citing the latest data available to him, Papanastasiou said strategic reserves total 530,000 metric tonnes, including unleaded petrol, diesel and heavy fuel oil.
How prepared do you think Cyprus is if the disruption in the Strait of Hormuz continues?