2023-09-26 12:00:00
ENERGY – Russia has banned exports of gasoline and diesel to all countries except Belarus, Kazakhstan, Kyrgyzstan and Armenia, which belong to the Eurasian Union, led by Moscow. According to an announcement from the Kremlin, this measure which came into force on Thursday September 21 aims to try to reduce the fuel shortages facing the Russian domestic market.
The shadow of a winter likely to plunge European economies into an energy crisis suddenly materialized with this decision from Moscow: the ban on diesel exports. Implemented last Thursday, this measure aims to resolve fuel shortages inside the country, where prices are experiencing a dizzying rise, with the aim of stabilizing the domestic market.
According to the Russian authorities, this decision is considered provisional, although no indication has been given as to its period of application. “The temporary restrictions will help stabilize the fuel market, which will reduce prices for consumers”explained the Ministry of Energy, specifying that the ban – which also applies to gasoline – would prevent exports “grises” unauthorized vehicle fuel.
Growing pressure on fuel exports to Russia
The shortages have been particularly worrying in parts of southern Russia, where fuel plays a vital role in harvesting operations. A major crisis at this stage could prove embarrassing for the Kremlin, given the approach of presidential elections scheduled for March.
Russia has already cut its seaborne exports of diesel and gasoil by almost 30%, or about 1.7 million metric tons, in the first 20 days of September compared to the same period in August, according to traders and analysts. LSEG data. Last year, the country exported 4.817 million tonnes of gasoline and almost 35 million tonnes of diesel.
Impact mondial
Since the start of the year, Russia has become the world’s largest exporter of diesel by sea, far ahead of the United States, according to Vortexa data compiled by Bloomberg. The country exported more than 1 million barrels per day between January and mid-September, with Turkey, Brazil and Saudi Arabia among the main destinations.
However, the ban implemented on Thursday could worsen current shortages in the global diesel market. Oil refiners around the world are struggling to produce enough fuel in the face of dwindling crude supplies from Russia and Saudi Arabia, the largest producers in the Organization of the Petroleum Exporting Countries (OPEC). and its allies.
“Although this is only a temporary ban, the impact is significant as Russia remains a key exporter of diesel to global markets”Alan Gelder, vice president of refining, chemicals and petroleum markets at consultancy Wood Mackenzie, told Bloomberg. “The global refining system is struggling to replace lost Russian volumes at a time when global diesel stocks are already low”he added.
Russia Dominates Despite Sanctions
This measure removes a major player from the market, with Russia remaining the world’s largest exporter of this fuel despite European sanctions in 2022. Although this decision does not appear to be directed against the European Union (EU), as had been the case with gas the previous year, it could potentially affect the EU, if gas oil supplies decrease.
Following Thursday’s announcement, diesel prices in Europe continued to rise, increasing by almost 5% to exceed $1,010 per tonne. Oil prices also rebounded, erasing previous losses, with Brent, the international benchmark, rising 1% to $94 a barrel.
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