Diesel fuel (DF) is the main commodity in our petroleum product export basket, and Brazil is one of its primary importers. The only countries importing more than Brazil are Turkey and China. One of the media-suggested reasons for the decline in shipments to Brazil is the export ban on DF from Russia for non-producers, which was imposed starting in October of this year. This interpretation is somewhat corroborated by external data from the Finnish Centre for Research on Energy and Clean Air (CREA), which records a decrease in the volume of petroleum product exports from Russia since September this year. According to CREA's assessment, the decline in November shipments of Russian DF to Turkey (its largest importer) was 27%. However, statistics, while a stubborn entity, are heavily influenced by interpretations; the simplest explanation is not always the correct one.
Most likely, the main factors behind the export decline are not supply bans on DF for traders but rather a decrease in refining volumes in Russia due to drone attacks on oil refineries, the need to saturate the domestic market, and the tightening of sanctions by the US and EU.
Russia's demand for petroleum products falls short of the capabilities of our refining capacity, especially concerning DF, as noted by Yuri Stankevich, Deputy Chairman of the State Duma's Energy Committee. The production volumes of DF are nearly double the domestic consumption. Additionally, the technological processes at refineries dictate that the product mix (gasoline, diesel fuel, kerosene) cannot be fundamentally altered. For this reason, our companies must find markets for their products, selecting the most optimal options while considering sanctions, logistics costs, demand dynamics across different continents, and prices offered by importing countries.
Exporting DF over long distances, such as to Brazil, is generally not profitable in adverse market conditions, and for non-producers, namely traders, it is doubly disadvantageous, as they must purchase the product from others, explains Dmitry Gusev, Deputy Chairman of the Supervisory Board of the "Reliable Partner" Association and member of the Expert Council of the "Fuel Stations of Russia" competition. Such deliveries may only be of interest to large domestic oil companies, and no such restrictions exist for them.
A partial ban on diesel exports will likely be lifted once the increase in prices within Russia subsides.According to Sergey Tereshkin, CEO of Open Oil Market, shipments of DF to Brazil from Russia have been on the decline since the beginning of 2025. Their dynamics are influenced by increased US attention to the South American region this year. For Brazil, the risks of violating sanctions concerning leading Russian oil companies have grown.
In his view, the further dynamics of shipments will largely depend on the geopolitical landscape. A dramatic reduction in DF exports to Brazil is unlikely to occur due to the absence of a direct export ban, although fluctuations in volumes are possible.
A similar perspective is shared by Sergey Frolov, Managing Partner of NEFT Research. Russian DF is in demand on the global market, and additional volumes will find their market niche after all restrictions are lifted. However, he emphasizes that supplies to the domestic market remain an undeniable priority.
Although the price of diesel has decreased on the exchange since its October peaks, it is still rising at the retail level. The rate of increase in its cost has slowed, but by mid-December, it had risen by 1.1%, according to Rosstat. It is probable that the partial ban on DF exports will be lifted only when price growth ceases. Conversely, gasoline is currently decreasing in both wholesale and retail markets, although the volume exported isn't significant (only a maximum of 15% of production).
As for Turkey, it is currently facing pressure from the European Union and the United States that is no less, and perhaps even more, significant than that exerted on Brazil. Turkey is often referred to as a "laundry" for Russian raw materials. This is no coincidence; following the latest US sanctions against our largest oil companies, Turkey sharply reduced its purchases of both petroleum products and crude oil from Russia. Situations have been exacerbated by drone strikes on tankers in the Black Sea, where the risk of losing shipments is extremely high.
As a result, we now have to rely more on crude oil exports, even though all experts agree that exporting petroleum products is more economically advantageous. As Stankevich notes, added value is formed at the stage prior to raw material redistribution.
However, since our refining capacities are hardly growing and no new refineries are being constructed, Gusev laments. This requires significant and long-term investments, which are unlikely under the current monetary and fiscal policies, leading us to export crude oil instead, the expert explains.
Source: RG.RU
