Page 10 - FSUOGM Week 17 2021

FSUOGM POLICY FSUOGM

Russia takes steps to make it easier to

ban gasoline exports if necessary

RUSSIA RUSSIA’S government has asked the Energy Around 80% of Russian gasoline exports go
Ministry to prepare changes that would enable to customers outside the EAEU. Of those that are
The government has a ban on gasoline exports to be swiftly enforced sold inside the union, Kyrgyzstan accounts for
been discussing export in the event of an emergency, Kommersant the lion’s share.
restrictions since reported on April 26. The ban would apply to The largest gasoline exporter in Russia is the
mid-April. all countries outside the Russia-led Eurasian 230,000 barrel per day (bpd) Kirishi refinery
Economic Union (EAEU), whose other mem- owned by Surgutneftegaz, commanding a 35%
bers are former Soviet states Armenia, Belarus, share of national gasoline exports. Its shipments
Kazakhstan and Kyrgyzstan. average 140,000 tonnes per month, and they are
The government has been discussing poten- almost all sold to Europe via the Russian Baltic
tial restrictions on gasoline exports since mid- pot of Ust-Luga. Other mostly export-oriented
April, in order to avoid a spike in domestic plants include the independent Antipinsky
fuel prices as demand rises during the warmer refinery and the Lukoil-owned Nizhegorod
months of the year. Supplies can also be lower refinery.
in spring and autumn, when refineries reduce “The government is unlikely to go through
output so that seasonal maintenance work can with the ban on exports in the near future, and
take place. we think that domestic gasoline deliveries will
In an effort to stabilise domestic prices, grow in the wake of the threshold damper price
the government plans to adjust the so-called being lowered on May 1,” analysts at VTB Capital
damper mechanism in Russian oil taxation on (VTBC) wrote in a note.
May 1, to give suppliers more incentive to keep Were a ban to be imposed, though, Surgut-
prices lower. Under this mechanism, suppliers neftegaz would be worst affected, as it exports
must pay more into the budget when indicative 70% of the gasoline it produces. This could result
domestic pump prices are higher than export in a loss of up to $7mn, or 1% of EBITDA, if the
netbacks. Conversely, they can collect a subsidy ban were to remain in force for three months,
when the situation is reversed. VTBC said. ™

P10 www. NEWSBASE .com Week 17 28•April•2021