Russia cuts gasoline railway exports by half after self-imposed embargo

Russia cut railway gasoline exports by half in March after imposing a fuel embargo. The growth of domestic demand and unplanned shutdowns of oil refineries have led to a tense situation in the domestic market.

Source: Reuters

At the end of February, Russia imposed a six-month ban on gasoline exports from 1 March to stabilise prices amid growing demand from consumers, farmers, and oil refineries.

Exceptions were made for fuel supplied under intergovernmental agreements, particularly with the Eurasian Economic Union member countries led by Moscow.

Reuters calculations based on data from sources state that Russian refineries exported about 323,000 tonnes of petrol by railway in March. This petrol was mainly supplied to Mongolia (75,500 tonnes), Uzbekistan (53,500 tonnes), Tajikistan (47,800 tonnes) and Kyrgyzstan (42,300 tonnes).

Market sources claim that last month, only about 16,500 tonnes of gasoline were exported through the Russian Baltic port of Ust-Luga, almost 13,300 tonnes to the Arctic port of Murmansk, and nothing to the ports of Vysotsk, St. Petersburg and Novorossiysk.

Traders expect a further decline in Russian gasoline exports due to seasonal maintenance and unplanned shutdowns at refineries.

Background:

• The Russian government banned gasoline exports from 16 March for six months and increased the standard for diesel fuel sales on the stock exchange to 16%. They want to take such measures to combat rising fuel prices.
• In September 2023, the Russian government reported that they were ready to take drastic measures in the fuel market due to a record increase in wholesale prices.
• Russia increased fuel imports from Belarus in March to overcome the risk of shortages in its domestic market, which arose due to repairs at Russian oil refineries after drone attacks.

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