The Ministry of Energy emphasizes that the primary task remains to fully meet domestic fuel demand, including for agricultural producers during the seasonal fieldwork period. The possibility of exports will be determined based on the evolving fuel balance, production volumes, inventory levels, and the dynamics of domestic demand.
In August, there were no reports of any issues regarding the availability of DТ at filling stations (FS). Difficulties arose mainly with gasoline, particularly AИ-95. According to the same Ministry of Energy, the situation with the domestic DТ supply is currently stable. After the export restrictions, additional volumes were redirected to the domestic market.
140,000 tons of diesel fuel are consumed in Russia during peak demand periods in spring and autumn.Historically, Russia has produced significantly more diesel than gasoline—approximately twice as much—exporting a substantial portion. For instance, in 2023, total DТ shipments from Russian refineries reached 87.9 million tons, with 52.2 million tons allocated for the domestic market and 35.7 million tons for export, according to Sergey Tereshkin, CEO of Open Oil Market. In his opinion, a surplus is likely to persist even now, despite unforeseen repairs at the refineries.
This raises the question: why extend the ban then? From the perspective of Dmitry Prokofyev, Director of External Communications at NEFT Research, maintaining the ban on diesel exports guarantees the physical availability of fuel in the domestic market during peak seasonal demand. It is no coincidence that the Russian Fuel Union (RTS) insisted on maintaining restrictions in a letter to Deputy Prime Minister Alexander Novak on August 24, warning that lifting the embargo on September 1 could destabilize the already fragile balance of supply and demand within the country. A traditional autumn spike in demand is anticipated, alongside the transition to production and stockpiling of winter-grade diesel. Opening exports under these conditions poses unreasonably high risks of worsening the situation, Prokofyev believes.
There is also the price factor to consider. As of August 17, according to Rosstat, with inflation at 4.67%, retail diesel prices have increased by 18.4% since the beginning of the year. Prices for DТ have decreased in recent weeks, but demand will start to rise in the autumn, posing a risk of price increases once again. Extending the ban minimizes this risk.
Dmitry Gusev, Deputy Chairman of the Supervisory Board of the "Reliable Partner" Association and a member of the Expert Council for the "Gas Stations of Russia" competition, believes that the ban not only addresses the issue of uninterrupted supply to the domestic market, but also reduces the global DТ supply, which is tactically advantageous for us. As a result, prices at filling stations, for instance, in Europe are rising. There, the impact of drone attacks on our refineries is keenly felt in terms of their financial burden, explains the expert.
Extending the diesel export ban will help curb price increases at fuel stations.However, there is a nuance that the rise in global DТ prices indirectly fuels its price increase in Russia. At least until diesel production in Russia is exclusively for the domestic market. Moreover, the increase in global DТ prices raises compensation payments from the RF budget to domestic refineries and fuel importers for deliveries at prices lower than those on foreign markets.
Regarding the timelines for the extension, experts' opinions differ. Gusev believes the ban will be extended until November 1 or even longer. To avoid market saturation, excess DТ volumes may be purchased by the government to create a strategic reserve that can be used for both the domestic market and exports.
Tereshkin thinks that if the ban is extended, it is unlikely to exceed one month. Diesel exports are an important source of revenue for refineries, which are currently incurring costs due to partial capacity losses. Additionally, an excessively lengthy ban poses a risk of oil production decline.
The risk of reduced oil production exists, agrees Prokofyev. It is directly linked to the load at the refineries. If they cannot export diesel, their incentives to maintain high capacity utilization decrease. A reduction in processing leads to decreased demand for oil, which consequently results in lower production. However, the expert suggests that the most likely scenario is a 1-3 month extension of the export embargo. A short-term extension should not cause significant harm to refineries. Current production volumes and domestic demand can absorb current output levels. A medium-term extension (until the end of 2026) is a riskier scenario. If production begins to recover while exports remain closed, refineries may face the necessity to reduce loads, the expert underscores.
Source: RG.RU
