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7 Oct, 2023 10:22

Russia relaxes ban on fuel exports

Cross-border sales were halted last month in a bid to stabilize the domestic market
Russia relaxes ban on fuel exports

The Russian government has lifted restrictions on diesel exports, but a ban on gasoline shipments out of the country remains in place, the press service of the Council of Ministers announced on Friday.

The measures were introduced last month in an effort to stabilize the domestic fuel supply.

Diesel shipments can resume under two conditions – if the fuel is delivered to the ports by pipeline and if the manufacturer supplies at least 50% of diesel it produces to the domestic market.

Friday’s announcement comes less than three weeks after Russia placed a near-total ban on both diesel and gasoline exports following a spike in domestic wholesale fuel prices due to shortages of the fuels. The restrictions caused a surge in prices in the global oil market, which was already tight due to crude supply cuts implemented earlier this year by Russia and Saudi Arabia.

However, the ban helped cool the fuel price spike in Russia’s domestic market. According to Reuters’ calculations, wholesale diesel prices on the local exchange have dropped by 21% since the ban was introduced, while gasoline prices have decreased by 10%.

In order to keep the fuel supply at home stable, on Friday, Moscow hiked the fuel export duty for resellers, which do not produce the fuel, from 20,000 rubles ($198.6) to 50,000 rubles ($495.6) per ton.

The government is quelling attempts by resellers to purchase fuel in advance for subsequent export once the current restrictions are lifted. This also prevents them from exporting... fuel under the guise of other products,” the Council of Ministers said in its statement.

It has also reinstalled subsidies, or damper payments, for oil refineries. The subsidies were halved last month amid efforts to lower budgetary spending.

For more stories on economy & finance visit RT's business section

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