Russia Might Lift Ban On Pipeline Diesel Exports

Russian authorities are planning to partially lift the ban on diesel exports through pipelines in the near future.

This move will be subject to quotas to prevent any sudden price surges in the wholesale market. However, the ban on gasoline exports will still be in effect according to Russian national daily, Kommersant.

Transneft, the Russian oil pipeline monopoly, is reportedly running low on storage, and redirecting any excess to the domestic market is almost impossible.

On Tuesday, Russia announced that it is not setting a time frame for the fuel export ban it recently imposed. Despite being one of the world's major oil producers, Russia has faced gasoline and diesel shortages in recent months due to high export prices, which made it more profitable for refiners to sell their products overseas.

Currently, authorities are planning to take stronger measures to control the illegal practice of "grey export". This occurs when products intended for the domestic market, and for which producers have received compensation, are exported by third-party companies not involved in the production process.

Deputy Prime Minister Alexander Novak recently stated that future bans on oil product exports will only apply to companies not involved in production. Market sources report that these grey exports have caused spot prices to surge.

A decision on partially lifting the export ban is expected to be made by the end of the week. If not, some refineries will be forced to reduce their production.

Russia had announced a temporary ban on most diesel and gasoline exports on 21 September, in a bid to curb soaring domestic fuel pump prices.