Kazakhstan’s largest oil refineries have decided not to use their allocated quotas for supplying gasoline to Russia, four sources told Reuters.
According to the agency’s interlocutors, in July, the Ministry of Energy of Kazakhstan allowed the shipment of 17.5 thousand tons of A-92 gasoline from the Pavlodar oil refinery – the second largest in the country (5.5 million tons per year) – to the Russian market. The Atyrau oil refinery (also with an annual capacity of 5.5 million tons) received a similar quota in August.
Why won’t they supply gasoline to Russia?
Nevertheless, according to Reuters sources, oil product managers do not intend to export gasoline. As reasons, they cite the complexity of settlements through Russian banks and the risk of incurring Western sanctions.
“No one wants to be hit by sanctions,” one of the agency’s interlocutors said.
Furthermore, the quantities of fuel in Kazakhstan’s domestic market are currently insufficient, Reuters sources emphasize: demand is seasonally high, and neighboring countries, like Russia, are experiencing a deficit.
A small oil refinery made an exception
The only Kazakh company that agreed to supply gasoline to Russia is the small oil refinery “Kondensat”, with a capacity of 850 thousand tons per year. In August, it received its first 4.1 thousand-ton batch of Russian oil by rail, and previously purchased oil from “Tatneft”. In July, this refinery sent 9 thousand tons of gasoline to Russia.
Gasoline from the Atyrau oil refinery is too expensive for Russian importers, Reuters sources say: a ton of A-92 gasoline costs 1100–1200 US dollars. This is approximately 43 percent more expensive than the current price on the St. Petersburg International Mercantile Exchange, where a ton costs 70,828 rubles.
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Russian gasoline production meets only two-thirds of demand
According to Dmitry Prokofiev, Director of External Communications at “NEFT Research”, domestic gasoline production in Russia now covers only two-thirds of demand.
Since the beginning of the year, Ukrainian drones have attacked Russian oil refineries more than 70 times, “The Moscow Times” reminds. In early August, at least 18 refineries were completely inoperable or operating below full capacity, and in the past four weeks, another 5 oil refineries completely halted fuel production.
According to “Rystad Energy” estimates, oil refining volumes in Russia are approximately 30 percent behind the seasonal norm, reaching about 4 million barrels per day.
In September, oil workers will not be able to eliminate the deficit with their production capacities: in optimistic scenarios, fuel supply will increase by only 10–15 percent, sector sources told “Kommersant”.
