On Friday, the press service of the Russian Council of Ministers announced that Moscow has lifted its limit on the export of diesel fuel, however it is continuing to ban the export of gasoline for the time being to maintain sufficient supplies for the domestic market.
Both measures had been imposed last month to assure adequate supplies of the fuel domestically.
Under the new rules, diesel exports are allowed to resume if they meet two conditions. The fuel must be delivered to the port by pipeline, and the manufacturer can only export a maximum of 50% of the diesel fuel it produces, so long as the other 50% is supplied to the Russian domestic market.
The announcement was made less than three weeks after the government placed the ban on exports of both diesel and gasoline due to a domestic shortage of the fuels causing prices to skyrocket. The ban on Russian exports triggered a temporary surge in global prices, due to the supply restriction in a market which had already been tight due to cuts in production output which were implemented earlier this year by both Saudi Arabia and Russia.
The ban managed to temper the spike in fuel prices on the Russian domestic market, however. Wholesale diesel prices on the local exchange are down 21% since the implementation of the ban, as the prices of gasoline have fallen by 10%, according to calculations by Reuters.
On Friday, in an effort to stabilize the domestic fuel supply, the Kremlin increased the fuel export duty for resellers who are not manufacturing the fuel. The duty went up from 20,000 rubles ($198.60) to 50,000 rubles ($495.60).
In its statement, the Council of Ministers said, “The government is quelling attempts by resellers to purchase fuel in advance for subsequent export once the current restrictions are lifted. This also prevents them from exporting… fuel under the guise of other products.”
The government also reinstituted subsidies for oil refineries, after reducing the subsidies by half last month in an effort to reduce government spending.