Gasoline was brought to the exchange – Newspaper Kommersant No. 62 (7507) dated 04/11/2023

Despite the rise in oil prices, the weakening of the ruble, repairs at refineries and the beginning of the season of high demand for fuel, wholesale gasoline prices within the Russian Federation do not increase. According to market participants and experts, low prices are largely due to a significant level of supply and reserves at refineries. In addition, refineries have not yet fully entered into spring repairs, and the average daily level of oil refining in April is higher than in the previous two months. According to experts, a steady increase in fuel prices is not expected in the next two weeks.

The cost of gasoline at SPIMEX decreases in April relative to March values. So, according to the exchange, over the month, AI-92 and AI-95 fell in price by 4.6% and 1%, to 45.6 thousand and 50.8 thousand rubles. per ton, respectively. On April 10, the cost of AI-92 increased by 0.16%, while AI-95, on the contrary, fell in price by 0.93%.

Gasoline prices resumed their decline in the first half of March, and before that, they had shown continuous anomalous growth for several weeks, which Kommersant’s interlocutors attributed to high export rates, despite the price ceiling for Russian oil products that came into force on February 5, as well as an increase in purchases of fuel by market participants against the backdrop of reduction of damper subsidies since April. According to the price ceiling for oil products, companies from the EU and the G7 countries cannot provide sea transportation and insurance services for Russian fuel if the sale price exceeds the established limit of $100 per barrel of gasoline and diesel fuel.

In previous years, fuel prices rose in April due to a decrease in the volume of supply due to a seasonal increase in demand and the simultaneous departure of the largest oil companies for repair work at refineries.

At the same time, according to Kommersant’s sources, in the first five days of April, oil companies processed about 788 thousand tons of oil per day – this is even more than in February and March, when the average daily level of processing did not rise above 780 thousand tons.

Refining volumes have not declined despite the government’s intention to cut oil production by 500,000 barrels per day in March.

The limiting factor for the rise in fuel prices is the high level of gasoline stocks at oil depots and refineries – about 2 million tons. An increase in fuel prices could have been caused by an increase in netbacks due to the weakening of the ruble and an increase in oil prices in April, but the high level of supply prevents an increase in prices.

The trend towards a surplus of fuel in the Russian market emerged at the beginning of last year. As a result of Western sanctions against the Russian Federation due to the outbreak of hostilities in Ukraine, many European traders refused to purchase Russian fuel. This led to a decrease in the cost of fuel, which has not yet recovered to pre-sanction levels.

Low wholesale prices for fuel increase the attractiveness of its sales at gas stations. In previous years, the government informally held back the growth of retail prices within the limits of inflation, but in 2022-2023, filling stations practically did not raise prices in the face of collapsed fuel prices in the wholesale segment. So, in 2022, gasoline at gas stations rose in price by only 0.9%, with annual inflation of more than 11.9%, according to Rosstat.

“Gasoline prices in the domestic market are not growing due to the fact that independent market participants maintain sufficient stocks of goods and the growth of stocks of oil companies,” notes independent expert Mikhail Turukalov. gasoline production is still at the March level.” He also doubts that the next two weeks will see a steady increase in gasoline prices.

Dmitry Kozlov