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Russia cuts gasoline, diesel exports to offset refinery outages

Published 31/01/2024, 17:42
© Reuters. Fuga Bluemarine crude oil tanker lies at anchor near the terminal Kozmino in Nakhodka Bay near the port city of Nakhodka, Russia, December 4, 2022. REUTERS/Tatiana Meel/File Photo
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MOSCOW (Reuters) - Russia has reduced gasoline exports to non-CIS countries to compensate for unplanned repairs at refineries, the Ministry of Energy said on Wednesday, as the country grappled with the impact of fires and drone attacks on its energy infrastructure.

It said gasoline and diesel exports have been reduced in January by 37% and 23% respectively from the same month in 2023.

Russia and Ukraine have targeted each other's energy infrastructure in strikes designed to disrupt supply lines and logistics and to demoralise their opponent as they seek the edge in a nearly two-year-old conflict that shows no sign of ending.

Russia is voluntarily cutting its oil and fuel exports by 500,000 barrels per day in the first quarter as part of efforts by the Organization of the Petroleum Exporting Countries and allies (OPEC+) to support the energy markets.

The cuts, announced by the energy ministry on Wednesday to countries beyond the Commonwealth of Independent States, are separate and prompted by downstream capacity outages.

Outages include the halt, following what is believed to be a technical incident, of a unit at NORSI, the country's fourth largest refinery, located near the city of Nizhny Novgorod, some 430 km (270 miles) east of Moscow. It is operated by Russia's second-largest oil producer Lukoil.

Russian Deputy Prime Minister Alexander Novak said on Jan. 27 that repair work would take a month or a month and a half.

Russian energy giant Novatek on Jan. 21 was forced to suspend some operations at the huge Baltic Sea fuel export terminal at Ust-luga, as well as "technological processes" at a nearby fuel-producing complex, after a fire, started by what Ukrainian media said was a drone attack.

Russia will likely cut exports of naphtha by some 127,500-136,000 barrels per day, or around a third of its total exports, after fires disrupted operations at refineries on the Baltic and Black Seas, according to traders and LSEG ship-tracking data.

© Reuters. Fuga Bluemarine crude oil tanker lies at anchor near the terminal Kozmino in Nakhodka Bay near the port city of Nakhodka, Russia, December 4, 2022. REUTERS/Tatiana Meel/File Photo

The ministry also said on Wednesday that major Russian oil companies had boosted gasoline production, which resulted in an increase of gasoline supplies to the domestic market in first 25 days of January by 7%, or 150,000 metric tons, year-on-year, and diesel supplies by almost 17%, or 490,000 tons.

The country's inventories for ensuring stable supply of the domestic market amount to 1.9 million tons for gasoline and 3.9 million tons for diesel fuel, up 16% and 7% from January 2023, it said.

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