The Russian government announced that the diesel export ban for fuel producers has been extended until the end of October, with restrictions on most marine fuel and gas oil exports also being prolonged. The official reason is to stabilize the domestic refined oil market while considering the fuel demand for the harvest season.

The ban was initiated on July 8 for producers and has been renewed monthly, previously extended from the end of August to September 30. The ban on diesel and gasoline exports for non-producers remains until January 31, 2027, and the restriction on aviation kerosene lasts until the end of November 2026. Exceptions for intergovernmental agreements with former Soviet countries and Mongolia are still allowed. Russia is typically the world's second-largest diesel exporter after the United States, and summer exports have already declined ahead of the ban.

Ukrainian drone strikes have forced some large refineries to significantly reduce production or halt operations, with three out of six major diesel refineries facing significant restrictions in September. Marine diesel exports fell to less than 1 million tons in June, down from about 2.5 million tons a year earlier. Domestic retail diesel prices have risen over 18% since the beginning of the year. The Energy Ministry stated that restrictions may be adjusted again after supply and inventory are restored.

Global diesel prices are under pressure: U.S. pump prices have risen above $6.50 per gallon, setting a record, while U.K. pump prices have also reached a record high, exacerbated by conflicts in the Middle East and refinery losses. The U.S. is also discussing its own export restrictions. With winter demand in the Northern Hemisphere about to rise, extending the ban for another month effectively locks tradeable supplies into domestic Russian demand.

Deputy Prime Minister Novak previously stated that there is no diesel shortage domestically and that the decision to lift the ban would depend on market recovery, but the actual path has been continuous extensions. The harvest season, heating season, and refinery maintenance windows are overlapping, making it difficult to open the export valves in the short term.

In market dynamics, sellers are forced to keep diesel in domestic Russian refineries, while buyers are importers from Europe, Turkey, Brazil, and the U.S. who must bid for a narrower supply. This is a supply contraction driven by restrictions, not a sudden surge in demand. Funds and premiums are still flowing to diesel from the Middle East, the U.S. Gulf, and alternative routes that can still be shipped, while the pressured parties are transportation, agriculture, power generation, and retail fuel prices. Beneficiaries are non-Russian exporting refineries and traders holding diesel inventories.

Source: Public Information