He. How are you? How are you all? Let's continue in this Wake Up Spain. We are now getting into the analysis, the first conversation this morning, on this first day of the sixth edition of Wake Up Spain. With us, I am Arturo Mazo from Repsol. How are you, Mr. Imaz? How are you? Good morning and welcome.
Good morning and thank you. I want to start by thanking Pedro and Cruz for this invitation. Sixth year in a row. For me it is an honor to be here, and just 10 seconds, Pedro, to thank you for your speech, thank you for your courage, thank you for your commitment and the role you play as a catalyst for this project of all of us here for a modern, competitive, innovative, open Spain, a questioned Europe, and what is also very brave today, and I absolutely share a clear commitment to Atlanticism. I know these are not the best times to defend it, but I think that betting on those of us who believe in democracy in this world is very important. Thank you.
Well, we're done. We can leave now. If you like, let's talk about football. Well, after listening to Pedro, I thought that some of us don't have much to contribute anymore. So, [laughter] football with the mayor of Madrid, because we have the final this Saturday, Atlético Madrid, Real Sociedad, but well, we'll see what happens, what happens. But well, let's talk about energy, if you like. We have the oil price. I had noted, look, I had noted here around 96, we are above $100. All this since Friday night when I updated this questionnaire to today. All due to the situation in the war in Iran, the conversations this weekend, well, it seems there have been no major advances. Now the United States saying it will close Hormuz. There are forecasts that oil could reach $150. What scenario are you managing at this moment?
Well, the figures you gave, Arturo, are all correct, but I want to start by saying that it's not that we are going to reach $150 as a hypothesis, we are practically there, because here we are seeing a decoupling between the financial world and the physical world. And those figures are for Brent, and Brent is like a theoretical crude that is practically non-existent from the North Sea. But last Thursday, the average of the physical transactions that were made, for those who need oil in three weeks, in a month, or in five weeks, those who need it now, we go. Last Thursday, an average of $132 per barrel was already done, last week there were many transactions at $140 per barrel. And what happens is that if I used to buy a crude, the reference to Brent was Brent minus 3, Brent minus 4, now it is being bought, especially in Asia, at Brent plus 20, plus 25. If we add that kerosene, for example, used to have a spread, a delta, a premium over Brent, well in December, January, it could be $60, $80, so we have been many days at Brent plus $90 per barrel, diesel at Brent plus $60, that is, kerosene has practically multiplied its price by 2.5, and diesel in international markets, for those looking for real physical product, beyond the financial markets, where today someone tweets and they drop 15%, another tweets and they rise 15%. Physical transactions are very strained.
Mm. In fact, you were just talking about kerosene. The European Airports association said on Friday that if the strait is not opened, we will have to manage the shortage of kerosene. Is there a real risk of shortage?
Let's see, in a world of uncertainty like the one we are in, I don't dare to answer categorically, I don't know what would give peace of mind to everyone, including Repsol's communications department. [laughter] But well, later when they call me from the communications department to scold me, but I think we all have to be aware that we are living in uncharted territory. I mean, three months ago none of us here would have anticipated the situation we are living through. In this sense, after the uncertainty generated by my first comment, I do want to add a reflection of some calm. The best prepared country in Europe to face the situation we are in is Spain. First, because we have large and good refineries and good companies, and I will start by speaking well of my competitors, a BP, a Total, a Repsol with good refineries, with a high degree of conversion, that can largely supply the Spanish market, that made investments and did our homework on time. We also have a huge advantage: 60% of the oil that arrives in Spain comes from America, from the entire American continent, and practically 30% comes from Africa, North Africa and the West African coast, so only 6% or 7% comes from the Middle East, very little. Therefore, we have a greater supply advantage than others, and because we have very good refineries with a high degree of conversion, and I won't go into technicalities, we are capable of processing 60 different types of crude every year. Therefore, it is true that we cannot rule out that in the future there may be strong competition for crude, as is already beginning in Asia and some Asian countries. This is very different, it has nothing to do with the Ukrainian crisis, with the invasion of Ukraine. In the invasion of Ukraine, not a single barrel, not kerosene or diesel from Russia was ever missing. They were simply diverted to other environments. They went to India, they went to China, but the physical product was not lacking. Here the physical product is lacking. There are 15 million barrels, which is practically 20% of what is traded by ship in the world of crude that are no longer leaving from Iran. There may be 6 or 7 million that can leave via pipelines, either through Al Fujairah in the Emirates or through Yanbu on the Red Sea, on the other side of Saudi Arabia. 45% of the kerosene that Europe receives comes from the Persian Gulf, and all of this is not leaving. And if the conflict ended tomorrow, if everything stabilizes tomorrow, we will need many weeks for that product to reach the markets. So I anticipate, in the best case that everything is resolved tomorrow, about 10, 12, 14, 15 weeks that will not be easy from the point of view of prices and supply. And of course, if this continues, to the extent that there may be a part of demand that is very inelastic, that is, that destruction with price is not so evident, we can enter uncharted territories. Uncertainty, because none of us know what is going to happen. And if anyone knows, please raise your hand. Raise your hand and tell us. And tell us and come and I'll sit down. [laughter]
That is clear. After the war in Ukraine, you were talking about it earlier, we were talking or commenting here in this Wake Up Spain that Europe should work on strategic autonomy, especially in energy matters. Have we made any progress on this point? In the speeches. Eh [laughter] eh and it is a step. No, no, no, no, I don't say it, I don't say it for show. I don't know if that's good.
