Russia’s ongoing fuel crunch may get worse in the coming months

Russia, one of the world’s biggest oil producers, is facing fuel shortages in some parts of its southern breadbasket, affecting the crucial harvest gathering. Market sources attribute these shortages to a combination of factors, including maintenance at oil refineries, infrastructure bottlenecks on railways, and a weaker ruble that encourages fuel exports.

The government’s decision to cut subsidies for refineries is expected to worsen the fuel availability situation in the world’s largest grain exporter. Regional oil product depots in Russia’s southern regions have been forced to cut or suspend fuel sales, and retail filling stations have had to limit fuel sale volumes to customers.

Farmers have also expressed concerns about fuel scarcity, with some reporting that oil product prices have risen by 10% to 20%. The situation is expected to improve no earlier than October, as many oil refineries will complete their maintenance, and seasonal demand is expected to decline.

The Russian government has been contemplating export curbs to prevent a serious fuel crisis, which is a sensitive issue ahead of a presidential election in March. Deputy Prime Minister Alexander Novak has denied fuel shortages but acknowledged that measures are being considered to ensure a stable supply on the domestic market, including increasing mandatory sales on exchanges and limiting the number of exporters.

Wholesale diesel prices in Russia began rising sharply in July, with commodity exchange diesel prices increasing by more than a quarter in the past two months. The situation is also exacerbated by the state’s practice of capping retail fuel prices and only allowing price increases in line with official inflation.

Elevate your business with QU4TRO PRO!

Gain access to comprehensive analysis, in-depth reports and market trends.

Interested in learning more?

Sign up for Top Insights Today

Top Insights Today delivers the latest insights straight to your inbox.

You will get daily industry insights on

Oil & Gas, Rare Earths & Commodities, Mining & Metals, EVs & Battery Technology, ESG & Renewable Energy, AI & Semiconductors, Aerospace & Defense, Sanctions & Regulation, Business & Politics.

By clicking subscribe you agree to our privacy and cookie policy and terms and conditions of use.

Read more insights

Offshore wind developers want the U.S. to ease subsidy requirements

Developers of U.S. offshore wind projects, including Equinor, Engie, and EDP Renewables, are urging the Biden administration to revise the requirements for subsidies under the year-old Inflation Reduction Act (IRA). The IRA mandates that clean energy projects seeking bonus tax incentives must utilize American-made equipment and be situated in low-income communities.

Biden to visit Vietnam next month to discuss broad range of issues

Next month, US President Joe Biden will visit Vietnam to discuss various topics with top officials, including technology, economy, regional stability, and climate change. The goal is to strengthen ties between the two countries, especially since China holds a significant position in the region.

U.S. firm Apache to invest $1.4 billion in Egypt’s energy sector

Apache Corporation has unveiled plans to invest $1.4 billion in Egypt’s energy industry next year. As one of the biggest foreign investors and the largest oil producer in Egypt, Apache’s investment aims to deepen its partnership with the country and expand its oil and gas exploration activities despite the global economic challenges.

Stay informed

error: Content is protected !!