Amid Rising Rates, Russia Curbs Petrol, Diesel Exports to Stabilise Domestic Prices

Emmanuel Addeh in Abuja

Russia is temporarily restricting exports of petrol and diesel to stabilise fuel prices on the domestic market, the country’s government has announced.

The disclosure ended weeks of speculation that authorities would limit exports in the face of soaring prices and shortages due to higher crude prices and weakening currency.

“The temporary restrictions will help raise supply on the fuel market, which in turn will reduce prices for consumers,” the Russian government said.

Before the temporary restrictions were enacted, Russia had raised the mandatory supply volumes of motor gasoline and diesel fuel to the commodity exchange to help ease the supply crunch.

Earlier, reports emerged that Russia was considering banning refined product exports to stabilise the domestic petrol and diesel prices.

Russia has been considering a fuel export ban since May in an effort to avert domestic fuel shortages and rein in prices after announcing a halving of subsidies to oil refiners that will start this month in order to keep more money in government coffers to fund its military operation in Ukraine.

The country was already said to be preparing to slash its diesel exports from its ports on the Baltic and Black Seas by nearly 25 per cent in September compared to the export plans for August.

 The plan for diesel exports in September lays out the lowest shipments since May this year when spring refinery maintenance was in place, according to industry data reported by Bloomberg earlier this month.

Lower diesel supply out of Russia would not only reduce Putin’s revenues but could also tighten an already tight global diesel market, Oilprice.com reported.