Russia once more weighs ban on gasoline exports

Russian authorities are weighing the reintroduction of a full ban on gasoline exports through to the end of October, amid tightening domestic supply linked to seasonal refinery maintenance and surging wholesale prices.

The proposal was discussed during a meeting of the Federal Antimonopoly Service’s (FAS) Exchange Committee on June 25, according to sources cited by Russian news agencies RIA Novosti and Interfax.

The potential export embargo would apply to all market players, including producers, and is intended to mitigate supply risks during the peak summer demand season, when many refineries are undergoing scheduled maintenance.

Wholesale gasoline prices have climbed sharply since the start of summer. On June 23, the price of AI-92 gasoline on the St Petersburg International Mercantile Exchange (SPIMEX) surged to RUB64,957 ($825) per tonne, while AI-95 hit RUB67,171 per tonne on June 24  –  the highest levels since September 2023, when Russia first imposed a comprehensive fuel export ban.

Prices corrected slightly on June 25, with AI-92 falling 1.4% to RUB62,775 per tonne and AI-95 down 1.2% to RUB66,674 per tonne. Despite the retreat, AI-92 has risen 9% since the start of June, while AI-95 is up 9.6%, driven by peak seasonal demand and constrained refining capacity.

Russia’s initial introduction of a sweeping ban on gasoline diesel exports in September 2023 was in response to a domestic fuel crisis caused by high demand, lucrative export alternatives and reduced refinery throughput due to maintenance disruptions. The embargo, which excluded intergovernmental supply agreements and certain other cases, triggered a sharp fall in exchange prices and helped ease shortages.

As market conditions improved, the restrictions were gradually eased. On October 5, 2023, diesel exports by pipeline were permitted for refineries selling at least 50% of their output domestically. Summer diesel exports resumed on November 22, followed by winter diesel from March 22, 2024. At present, FAS sees no need to reintroduce a ban on diesel exports.

Gasoline, however, has remained subject to tighter controls owing to lower spare production capacity. The full ban was initially in force from September 21 to November 17, 2023, then reinstated from March 1 to August 31, 2024, to stabilise the market during another wave of refinery outages.

From May 20 to July 31, 2024, the government temporarily relaxed the embargo, allowing exports by producers processing over 1mn tonnes per year, to prevent excess inventories. However, as maintenance disruptions dragged on, the full ban returned on August 1 and was extended through to the end of 2024.

On November 30, 2024, the government prolonged the export ban for non-producers until January 31 this year, while allowing direct producers to resume shipments. This arrangement was extended twice more – first to February 28, then to August 31. In late May, Deputy Prime Minister Alexander Novak said the energy ministry had proposed continuing restrictions for non-producers into September and October.

Now, a full embargo until the end of October is again under consideration.

Russia’s energy ministry said the country is well-prepared to handle peak summer demand without shortages. Fuel stocks, including both gasoline and diesel, are close to historic highs and sufficient to guarantee uninterrupted domestic supply, the ministry noted.

Officials added that the situation on the fuel market remains stable and that no sharp increases in retail prices at filling stations are expected. Nonetheless, the ministry will continue monitoring developments closely.

According to Rosstat data as of June 23, retail gasoline prices in Russia have risen 3% since the beginning of the year, including a 3.2% increase in AI-92 and a 3% rise in AI-95 – broadly in line with general inflation, which stands at 3.68% year-to-date.

FAS has attributed the recent spike in exchange prices partly to delayed demand following extended public holidays in June. Officials have also stressed that movements in wholesale prices do not directly feed into retail fuel costs.