Georgia imported almost 8,930 tons of finished lubricants from January through May, up 9% from the same period last year, the country’s Association of Petroleum Product Importers said last week in a news release.
The increased lube consumption can be attributed to the country’s larger imports of cars that are reexported mostly to Russia.
Tucked between Russia in the north and northeast and Azerbaijan, Armenia and Turkey in the south with Black Sea coast on the west, the tiny South Caucasus country of Georgia has no domestic lubricant production, and its market relies solely on imports.
In the first five months of this year, the largest supplier of lubricants to Georgia was Turkey, which shipped almost 2,000 tons, or 22% of the total imports. It was followed by Iran that shipped 1,700 tons or 19% of the total. Iran was followed by Germany. From January through May this European county shipped to Georgia a little more than 1,000 tons, a 12% share). Next was Azerbaijan, with 550 tons shipped or 6% of the total. The rest was shipped from other countries.
Georgia is one of the hubs in the region used by Russia to circumvent the Western sanctions when it comes to import of cars. As part of the sanctions imposed against Moscow for its aggression in Ukraine, the European Union and other Western countries halted their car shipments to Russia, categorizing them as “luxury goods.” The EU ban generally prohibits export of cars worth over €50,000. The Unites States, Canada, Great Britain, Japan and Australia introduced similar prohibitions.
In the beginning of this year, Georgia tripled its shipments of European and American cars to Russia. These are usually new or three-year-old automobiles imported by Georgia’s car dealers and resold abroad.
The country reexported 13,500 automobiles in the first two months of 2023. Most of which was shipped to Russia, directly or through other countries such as Armenia, Kyrgyzstan and Kazakhstan, by use of the “parallel import” scheme. In the same period in 2019 this number was 9,700.
The Russian government introduced the “parallel import” practice to circumvent the sanctions. Under this, it occasionally updates a list of products that may be imported and sold within the country, without regard for trademark and copyright protections. The list, for example, includes some lube products of ExxonMobil and Shell and many more Western automobile brands.