Share of 'gray' fuel exports reaches only few percent — Russia’s Energy Ministry

Business & Economy October 09, 2023, 18:45

Pavel Sorokin said that for the export ban to be lifted, prices at independent gas stations (which account for about 30% of the country's total) would have to return to the level of those at vertically integrated companies

MOSCOW, October 9. /TASS/. The share of "grey" fuel exports now reaches only a few percent, but it is enough to disturb market stability, Russian Deputy Energy Minister Pavel Sorokin said in an interview with the RBC TV channel.

"It (the share - TASS) is not very large, only a few percent, but a few percent are enough to create a market imbalance - a 1-2% deficit or surplus in exchange trading for any product would be enough. To prevent this, a protective tariff of 50,000 rubles per ton of oil product will be introduced," he explained.

Sorokin also added that Russia would be able to completely lift the export ban only when the domestic market is saturated with fuel. "[The export ban could be completely lifted] when the market is completely saturated. Now the partial cancellation [of exports] has happened, taking into account the obligations to deliver at least 50% of diesel to the domestic market. We will consider further steps depending on the situation," he said.

Sorokin said that for the export ban to be lifted, prices at independent gas stations (which account for about 30% of the country's total) would have to return to the level of those at vertically integrated companies.

On October 6, the Russian government approved a series of new structural measures to ensure the stability of the fuel market. In particular, it was decided to amend the Russian Tax Code and to restore, as of October 1, the specifications of the fuel damper, which had been adjusted as of September 1. Russia also eased restrictions on the export of diesel fuel by pipeline to seaports for producers that deliver at least 50% of their diesel fuel to the domestic market. To prevent possible "gray" exports, a protective levy on petroleum products of 50,000 rubles ($497.27) per ton has been imposed on fuel suppliers who buy it on the market rather than producing it themselves. According to the document, this measure will remain in force until the end of the year.

In addition, the authorities raised the requirements for oil companies to sell grade 5 gasoline at the exchange auctions from 13% to 15%, and diesel from 9.5% to 12.5%, increasing the guaranteed supply volume of in-demand fuels at the exchange auctions and the share of deals on competitive terms. The increase will take effect one month after its official publication, according to the government resolution - November 6.

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