According to state media, Russia does not rule out the introduction of quotas on exports of petroleum products, Russian Deputy Prime Minister Alexander Novak said today. Reuters reported that the country is trying to stabilize wholesale gasoline prices, which are now at a record high in Russia.
“It’s being considered. But there are other proposals. We have to weigh all the pros and cons,” Novak replied to a question about possible quotas for the export of petroleum products, according to RIA Novosti. He added that some refineries had postponed scheduled maintenance to meet growing demand.
Increasing refinery production could make it easier to meet Moscow’s pledge to cut oil exports by 500,000 barrels per day in August. By doing so, Russia is trying to boost the world oil market and achieve higher prices. A barrel of North Sea Brent crude is now selling for around $80, up from $110 a year ago.
The average price of gasoline on the International Commodity Exchange in St. Petersburg (SPIMEX) rose by 1.8 percent to 62,653 rubles per tonne on Wednesday. It reached the maximum for the period of record keeping. Retail fuel prices have been relatively stable because the state regulates them.
Russian oil can not be sold for more than $60 a barrel
The sale of oil and other energy products from Russia to the world market is subject to a series of restrictions imposed by Western states in retaliation for last year’s invasion of Ukraine by Russian troops. Russian oil, for example, remains on the global market but can be sold for a maximum of $60 a barrel. It exceeded that price last week but returned below $60 this week.
A barrel of Russia’s reference Urals crude for loading at the port of Primorsk on the Baltic Sea coast sold at just under $59 on Wednesday, according to data from Argus Media. A barrel of the same oil for loading in the Black Sea port of Novorossiysk costs slightly more than $59. Bloomberg reported that the organization’s price reporting data is used in price cap negotiations.
Overcoming the $ 60 per barrel limit for Russian oil was an important signal. Western companies cannot provide critical services such as transportation or cargo insurance if someone in the West buys Russian oil and pays more than the permitted $60 a barrel.
Instead of banning Russian oil, Western countries have imposed a price cap so as not to distort the global market too much if Russian oil disappears from it completely. By not allowing the price of Russian oil to rise significantly, it is trying to limit the revenues Russia derives from selling raw materials, which it uses to finance the war in Ukraine.
Source: CTK
