Russia’s daily diesel exports plunged by 28% in the first 20 days of September, before the government banned overseas shipments of the fuel in a move to curb domestic prices.
(Bloomberg) — Russia’s daily diesel exports plunged by 28% in the first 20 days of September, before the government banned overseas shipments of the fuel in a move to curb domestic prices.
The nation’s oil companies exported an average of about 65,700 tons of diesel a day from Sept. 1 to 20 via sea ports and railways, according to a person with knowledge of the matter. That compares with an average of some 91,800 tons a day for most of August.
Russia, the world’s biggest seaborne exporter of diesel-type fuels, shocked global markets last week by imposing a temporary ban on overseas supplies of the road fuel as it struggles to rein in surging prices at home. The restrictions came into force on Sept. 21 and have no expiry date.
The drop in diesel exports before the ban coincides with seasonal refinery maintenance in Russia, which is set to peak by mid-October. Production of the fuel shrank to almost 230,000 tons a day in the first 20 days of the month, the lowest since May.
READ: Russian Oil Processing at Lowest Since May Amid Peak Maintenance
Re-direction of some diesel cargoes to the domestic market also contributed to the decline in exports. While most Russian diesel usually remains at home, refiners increased daily supplies to domestic clients by almost 2% to some 157,000 tons from Sept. 1 to 20.
As surging fuel prices threatened Russia’s harvest and ignited inflation, the government moved from non-binding recommendations to legal restrictions on diesel exports. Still, the ban set out some exemptions, including minor deliveries to trade-alliance partners from some former Soviet republics, humanitarian aid and transit, as well as consignments that already have loading papers and are accepted by oil-pipeline operator Transneft PJSC and Russian Railways JSC.
The government has also excluded bunker fuel, gasoils and some middle distillates from the export ban, according to a decree published in the nation’s legal database on Monday.
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