Russia lifts temporary export ban on summer-grade diesel

Russia has lifted its temporary ban on summer diesel, the energy ministry said late Nov. 22, two months after it introduced the measures in a bid to boost domestic supplies and curb spiraling pump prices.

The decision follows a rebound in supplies which have saturated the domestic market, the statement said, leaving summer-grade diesel stocks 14% higher than when the ban was first implemented.

Summer diesel stocks now exceed 3.2 million mt, according to the ministry, leaving the market well-supplied and fulfilling the government's stated ambition to stabilize prices.

The move coincides with seasonal demand weakness for summer diesel as consumers have switched to winter-grade material, motivating the government to intervene to prevent refineries reducing throughput.

Recent price relief has been spurred by the end of the peak driving season and associated demand, while refineries returning from autumn maintenance have injected additional supplies into the market.

Relaxed measures therefore aim to guarantee high production volumes of gasoline and winter-grade diesel at refinery level.

In a previous rollback, Russia partially eased its diesel export ban Oct. 6, permitting seaborne exports delivered via pipeline to resume. The measure left ongoing controls for railcar diesel exports in effect.

Looser export controls injected around 700,000 b/d of exports to the global market in October. However, flows remain below pre-ban levels, according to data from S&P Global Commodities at Sea.

Russia exported an average of 938,300 b/d of diesel and gasoil over November 2022-August 2023, dropping to 665,333 b/d over September-November 2023, according to CAS data.

Measures restricting gasoline exports were rescinded in full Nov. 17.

The Ministry said the domestic market was now well-supplied with gasoline and all diesel grades, but pledged to monitor production and prices to determine whether further intervention is necessary.

The ban has had little noticeable effect on markets abroad. Platts, part of S&P Global Commodity Insights, assessed ULSD 10ppm sulfur FOB ARA Barges at $852.25/mt Nov. 22, down 16% from when the ban was introduced.