Gasoline production in Russia decreased by 1.8% over the 30 days of January.

As Kommersant learned, gasoline production in the Russian Federation over the 30 days of January decreased by almost 2% compared to last year’s level, to 3.49 million tons. The output was affected by the accident at the Nizhny Novgorod refinery of LUKOIL. However, shipments to the domestic market increased by 6.5% year-on-year due to the fact that oil companies reduced gasoline exports by almost a third.

Gasoline production in the Russian Federation over the 30 days of January decreased by 1.8% compared to the same period a year earlier, to 3.49 million tons, or 116.3 tons per day, sources familiar with industry statistics told Kommersant. Of these, oil companies shipped 3.047 million tons (about 101.6 tons per day) to the domestic market, which is 6.5% more than a year ago, and generally corresponds to the stated plan of the Ministry of Energy. Rosneft supplied about 994 thousand tons, fulfilling the recommendations of the Ministry of Energy by 93%. LUKOIL and Gazprom Neft exceeded the plan by approximately 12% and 7%, delivering 602 thousand and 765 thousand tons of gasoline, respectively.

The largest gap from the target indicators for shipments was demonstrated by Surgutneftegaz (owns the Kirishi Oil Refinery in the Leningrad Region), which fulfilled the target by only 50%, delivering about 53 thousand tons to the domestic market.

The Ministry of Energy told Kommersant that “if companies seriously deviate from plans and recommendations, the ministry informs the government about this, indicates the reasons and proposes actions for further consideration at meetings led by Deputy Prime Minister Alexander Novak.” “At present, all companies are generally responsible in implementing the recommendations; no significant deviations have been identified,” according to the Ministry of Energy.

The main shock for the gasoline market this year was the accident at the Nizhny Novgorod refinery of LUKOIL, but weak demand for fuel in the winter softened its consequences. We are talking about the failure of a catalytic cracking unit, the recovery time for which, according to Kommersant, is still unknown. Due to the stoppage of catalytic cracking, the production of AI-95 gasoline decreased by approximately 200 thousand tons per month. The Ministry of Energy promised that oil companies will redirect from export the amount of fuel that is missing for the domestic market.

According to Kommersant sources, gasoline exports on January 1–30 decreased by 31.5% compared to the same period in 2023, to 442.3 thousand tons. Almost all major oil companies have reduced fuel sales abroad. Thus, during the reporting period, LUKOIL reduced gasoline exports by more than six times, to 20.1 thousand tons compared to January 2023. Gazprom Neft reduced supplies abroad by 23%, to 52 thousand tons. Rosneft, on the contrary, increased exports by 53%, to 88 thousand tons. In January, due to drone attacks, the plants in Ust-Luga (NOVATEK) and Tuapse (Rosneft) stopped work, however, since these refineries supply fuel mainly for export, their shutdown had almost no effect on the supply of the domestic market.

On February 3, a drone also attacked a large LUKOIL oil refinery in Volgograd, damaging a primary oil processing plant. The company reported on the same day that the plant was operating normally, and the fire extinguishing on the pipeline of the ELOU-AVT-5 primary oil refining unit had been completed. The plant in Volgograd is extremely important for the supply of fuel to the south of Russia; it processes about 14 million tons of oil per year with a design capacity of 15.7 million tons. The AVT-5 installation was put into operation in 2022 after a large-scale reconstruction.

However, for now, Kommersant’s interlocutors in the industry do not expect significant consequences for the market, since the secondary processes that most affect the production of gasoline were not affected by the fire.

In February, gasoline exports from Russia will drop “quite significantly,” as the reduction in export shipments from refineries in January will begin to affect transshipment through sea terminals, says Victor Katona from Kpler. He notes that the reduction in seaborne gasoline exports will mainly affect the countries of North Africa and Nigeria; this product is supplied to Asia to a lesser extent.

In recent weeks, regulators have been concerned about the daily rise in gasoline prices at SPbMTSB, which was triggered by an accident at the Nizhny Novgorod refinery. Regulators began to intervene in the situation. FAS insisted on reducing the cost of fuel at gas stations, which was purchased in December at low prices. In addition, the regulator has intensified the fight against algorithmic fuel procurement systems on the stock exchange. As a result, a number of large exchange traders were punished with a fine, and the FAS and SPbMTSB intend to check trading participants for market manipulation in January. At the beginning of February, the price of gasoline at St. Petersburg International Trading Exchange began to decline. Thus, on February 2, AI-95 and AI-92 fell in price by 1.8% and 3.4%, to 53.3 thousand and 45.7 thousand rubles. per ton respectively.

Dmitry Kozlov