Alexey Gromov, Principal Director on Energy studies of the Institute for Energy and Finance, commented to Forbes on the government's decisions to stabilize the domestic fuel market.
"The decision as it is presented — and we have not yet seen the relevant government resolutions — looks very balanced and reasonable," Alexey Gromov says.
The idea of halving the damper was bad for the market, he believes. At the same time, the analyst notes that at the beginning of 2023, the idea of reducing the damper by 50% looked reasonable. At that time, Russian Urals grade oil was trading at a large discount relative to Brent, and the authorities were looking for additional sources of replenishment of the budget. In addition, there was no shortage in the fuel market, diesel prices on world markets were kept in normal ranges. But already in the summer, Gromov continues, fuel prices began to rise and it was clear that it was impossible to accept the damper in the version in which it had been adopted since September.
The amount of penalties for resellers is reasonable, according to Gromov.
Permission to export diesel through pipelines is also logical, the expert says. It is easier for regulators to track shipments via pipeline transport, he argues, so it will be easier for the authorities to track whether the exporter fulfills the requirement to sell more than 50% of the produced fuel on the domestic market. And in itself, this requirement is the right decision, the expert adds.
Alexey Gromov believes that the effect of the measures announced by the government, despite their logic, may not appear immediately, or even be blurred.
"A significant part of our exports falls on medium distillates, heating oil," the Forbes interlocutor recalls. — The government made it clear that medium distillates do not fall under the ban. Therefore, it is necessary to see whether the high demand for their export supplies will continue. Refineries have limited operating capacities, so if they load them for the production of medium distillates, and not diesel fuel or gasoline, then the country may again create tension with diesel and gasoline."
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