Combustible controversy: government to decide fate of gasoline exports
The government may extend the permission to export gasoline for large producers for six months or, on the contrary, impose a complete ban on supplies abroad from March 1 for a month. Both options will be considered on February 20 at a meeting with Deputy Prime Minister Alexander Novak, sources told Izvestia. FAS insists on the export ban ahead of the sowing season and scheduled refinery repairs, while the Ministry of Energy insists on extending preferences for oil producers. The current export permits expire on February 28. Izvestia's interlocutors are inclined to believe that the Cabinet of Ministers will support the Ministry of Energy. This decision is supported by the stable situation with supplies to the domestic market, the risks of the G7 tightening the price ceiling on Russian fuel, and possible US pressure on Ukraine demanding a moratorium on strikes on Russian energy facilities. However, it is not a fact that exports will be extended exactly for six months.
Export cannot be banned
The decision on the fate of gasoline exports should be made on Thursday, February 20, at a special meeting of Deputy Prime Minister Alexander Novak. Two sources familiar with the situation told Izvestia. The initiative to temporarily - from March 1 and for one month - to suspend gasoline supplies abroad is proposed by the Federal Antimonopoly Service (FAS).
On February 7, the deputy head of the agency, Vitaly Korolev, in an interview with TASS , explained the initiative by the growth of wholesale gasoline prices and the need to stabilize them ahead of the sowing season.
However, since then, exchange prices for fuel have fallen. According to the St. Petersburg Commodity Exchange, if on February 10, the cost of AI-92 reached Br57.5 thousand per ton, while AI-95 - Br59.5 thousand (it was the maximum since the beginning of the year), then on February 19, gasoline was traded at Br52.2 and Br55.9 thousand, respectively.
In turn, the Ministry of Energy submitted a proposal to the government to retain the permission to export gasoline for major producers from March to August inclusive.
Currently, according to the government decision, Russia has a temporary ban on gasoline exports.
It applies to those companies that do not produce it (traders, oil depots), as well as to small producers (up to 1 million tons of fuel per year).
At the same time, companies with a production capacity of more than 1 million tons are not covered by the embargo. The last time the government extended their export permit from February 1, 2025 for a month, i.e. until March 1.
Izvestia's interlocutors note that a decision on a complete export ban, if necessary, can be taken at any time.
Deputy Prime Minister Alexander Novak, commenting on the FAS initiative, noted that it requires thorough analysis.
- We will look, we will certainly make a decision related primarily to the saturation of the domestic market. It requires careful analysis. We will definitely work on this initiative together with the Ministry of Energy," Novak told reporters in mid-February.
Whether there is enough gasoline on the domestic market
- I expect that the resolution on preserving the export window for producers of petroleum products will remain in force. Of course, not until the end of summer. Given the rapidly changing situation, the government will discuss this issue at least once every two months, " Yuri Stankevich, deputy chairman of the State Duma Committee on Energy Policy, told Izvestia.
He pointed out that the situation with filling the domestic market is stable: in 2024, the fuel and energy industry has maintained stability of production indicators in the oil refining segment, despite all the external difficulties - sanctions, UAV strikes on refineries and oil depots, logistical constraints.
According to Yuri Stankevich, in 2024 fuel supplies to the domestic market increased - gasoline by 2.8% to the level of 2023 (up to 38.8 million tons), diesel by 4.7% (up to 54.5 million tons). In the current year, the situation also remains stable. According to the data cited by the deputy, in January, Russian refineries processed about 24 million tons of oil feedstock, produced about 4 million tons of motor gasoline and 7.4 million tons of diesel. Of these, about 3.3 million and 4.4 million tons were sent to the domestic market respectively.
At the same time, the average monthly consumption of gasoline in Russia is 3 million tons, diesel - about 4 million tons, said Ekaterina Kosareva, Managing Partner of WMT Consult.
- Production and sales forecasts remain stable, corresponding refinery repair schedules have been formed, taking into account the seasonality of fuel demand. At the same time, of course, in the current version they do not take into account the risk of terrorist attacks, which may affect the plans of producers. In terms of control over pricing, FAS Russia has all the necessary levers even without an export ban: we need to monitor the situation in individual regions more closely and react in a timely manner," believes Yuri Stankevich.
Transparent mechanisms of export restriction are needed
At the same time, a number of interlocutors of Izvestia partially supported the position of the Antimonopoly Service. Last year such a measure "worked quite comfortably," said Dmitry Gusev, Deputy Chairman of the Supervisory Board of the Reliable Partner Association.
- We need to protect the domestic market. And at the same time to work out clear and transparent rules of the game. For example, when a certain price is reached on the exchange, a ban on exports is imposed," he suggested. - At the same time, we have the potential to increase gasoline production, but financial and fiscal conditions do not allow us to do it today. It is necessary to think about stimulating measures so that the country could increase the output of motor fuel, and oil companies could supply it both to the domestic market and to export with a large reserve.
Grigory Bazhenov, head of the analytical center of the Independent Fuel Union, pointed out that in addition to a temporary ban on exports, FAS proposes as a strategic measure to create a forecast market for petroleum products in Russia on the basis of the emergency market. Such a measure "seems much more acceptable for the industry," the expert believes, because it will allow consumers to purchase gasoline in advance with a fixed delivery date, which will smooth out fluctuations in demand, a sharp increase in which leads to fluctuations in wholesale prices.
Grigory Bazhenov emphasized that spontaneous regulation "is fraught with unpredictability, which discourages producers.
- This is a good stop-cock in case of bad scenarios, but such pauses are needed to work out systemic solutions. Export bans have been imposed for two years, but there is still no progress with a universal solution," says Grigory Bazhenov.
According to Ekaterina Kosareva, the government is likely to choose a compromise solution, taking into account both the situation on the domestic market and external challenges.
- On the one hand, at the talks in Riyadh, the US delegation proposed a moratorium on strikes on Russian and Ukrainian energy facilities. Of course, this is still only a proposal, but we should not ignore it. On the other hand, the G7 countries may tighten the price ceiling on Russian oil, which may be announced as early as February 24. The Poles and the Baltics, of course, are not members of the G7, but they nevertheless proposed to introduce a ceiling at $40 per barrel. In any case, if supplies are restricted due to sanctions, it would be senseless to impose an export ban both from the point of view of filling the budget and solving the issue of overstocking oil depots," Ekaterina Kosareva concluded.
"Izvestia sent requests to the Ministry of Energy, FAS and major fuel producers to comment on the situation with the possible export ban. At the time of publication, no responses have been received.
Переведено сервисом «Яндекс Переводчик»
