Russia’s seaborne exports of fuels like diesel and naphtha are on course to edge higher this month as the nation’s refineries swing back into action following routine maintenance.
Traders are scrutinizing every scrap of data to understand whether Russia is fully honoring a prior pledge to cut its oil production by 500,000 barrels a day. Crude shipments have remained at high levels for most of the year, and there’s been no obvious sign of seasonally abnormal supply cuts within Russia itself.
Shipments of diesel, naphtha, gasoline and jet fuel, fuel oil and feedstocks that help refineries make other fuels rose by 51,000 barrels a day in the first ten days of the month compared with full-month May levels, according to data compiled by Bloomberg from analytics firm Vortexa Ltd.
Flows of the fuels had fallen sharply last month — but from very high levels earlier in the year — as refineries underwent routine seasonal maintenance that caused them to churn out less. The plants are now coming back to full operation, but there has yet to be a discernible surge in aggregate flows.
Diesel or gasoil shipments, the top export flow, climbed to about 1 million barrels a day in the 10 days of the month, the Vortexa figures show.
That’s 12% higher than in May when they plunged to a seven-month low. Outflows have remained resilient so far despite the loss of Russia’s biggest market in Europe, following the ban on Moscow’s fuel purchases by the European Union in February.
Russian diesel is instead being snapped up in other regions like Turkey and Saudi Arabia, with more cargoes also heading to Africa and South America. The country’s diesel exports are expected to jump by a third in June, according to industry data seen by Bloomberg.
Shipments of Russian naphtha, a feedstock used in making plastics and also gasoline blending, have also risen in June. Early estimates for the month stands at about 557,000 barrels a day, the highest since March, and up 14% from May.
Russia was the world’s biggest exporter of naphtha in January 2022, before Putin’s invasion of Ukraine. Though the nation’s share in global flows has shrunk since then, overall exports remained little changed as previously Europe-bound cargoes are diverted to Asia, Middle East and Latin America.
Read: Russia Will Adapt to Bans, Build Ties With Its Allies: Sorokin
However, the trend is reversed when it comes to gasoline. Russia’s exports of the motor fuel have plunged this month to 8,500 barrels a day, compared with 62,000 barrels a day in May.
The drop in exports follows the Russian energy ministry’s recommendation to boost domestic supplies and limit exports of the car fuel to prevent shortages. No jet fuel cargoes have been observed so far in June.
Shipments of feedstocks that refineries used to make other fuels, including gasoline, also slumped sharply in June.
Russian fuel oil shipments made a strong recovery.
Exports surged to 847,000 barrels a day in the first ten days of this month, up by 136,000 barrels a day from May. That’s the highest daily average since February 2022. Asia and Middle East have been the destination of bulk of the flows since Group of Seven sanctions.
Export volumes are almost certain to be revised as more shipments are observed for the rest of the month.
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