Russia plans to reduce diesel exports from its key western ports by a quarter this month amid seasonal refinery maintenance and government efforts to keep more fuel at home to ease growth in domestic prices.
Diesel loadings from Russian ports on the Black and Baltic Seas, including some batches from Belarus, are set at 1.874 million tons this month, down almost 25% from August’s plan, according to industry data seen by Bloomberg. That’s equivalent to 466,000 barrels a day, down from about 600,000 barrels a day from last month’s schedule, Bloomberg calculations show.
It is also Russia’s lowest diesel-exports plan since May, when the nation’s refiners held their spring maintenance season, according to historic data.
The plan seen by Bloomberg only shows shipments of diesel delivered to ports by pipeline. Smaller volumes may also be sent by rail. Actual flows may differ, depending on the weather and demand from foreign customers. Pipeline operator Transneft PJSC, which compiles the loading schedules, declined to comment on the September export plan.
The drop in diesel exports follows the decline in the nation’s refinery throughput as more plants undergo autumn maintenance. Russia’s daily primary crude processing on Aug. 24-Aug. 30 fell by nearly 240,000 barrels a day from the week before, according to a person with knowledge of the matter. The maintenance is set to peak between the second half of September and the first half of October.
READ: Russian Oil Refining Rates Hit Lowest Since Early June on Work
The nation’s refiners have been also redirecting some batches of diesel to the domestic market at the request of the Energy Ministry, as the government is struggling to curtail price growth on the road fuel.
The energy ministry has been advising refineries to limit overseas supplies of diesel and gasoline and sell more fuel at home to ensure the demand is met. In August, the nation’s overall fuel exports dropped to an 11-month low, reflecting both the start of maintenance and redirections of some volumes to the domestic market.
READ: Russia’s Fuel Exports Hit 11-Month Low Amid Refining Slowdown
For this month, the ministry recommended major oil producers curb their exports of Euro-5 grade diesel to just over 1.5 million tons. The recommendation is not legally binding and the nation’s producers may opt to export more high-quality diesel if the pricing abroad is more attractive than at home.
The ministry has also drafted a proposal to allow only oil refineries to export diesel and gasoline, a move that would combat so-called gray-market flows seen as a reason for rising prices. If approved, the proposal may somewhat limit fuel exports as companies that don’t produce fuel but purchase it domestically and re-sell abroad will not be allowed to continue the business.
(Updates with no comment from Transneft in the fourth paragraph.)
