Because of the repair of the Moscow refinery, which will last from January to April 2017, the market may experience a shortage of gasoline, warn independent traders and gas station owners. Reserves will last, the largest oil companies recommended to divert supplies to the domestic market retort to the energy Ministry
In anticipation of the renovation of the Moscow oil refinery, scheduled for January—April 2017, the energy Ministry recommended that the owner of this plant “Gazprom Neft”, “Rosneft” and LUKOIL, which also provide fuel to Moscow and the region, to refocus supply in the first place on the domestic market, reports “Interfax” with reference to the press service of the Ministry.
“For the purpose of uninterrupted supply of fuel in the Moscow region during the period of renovation of the Moscow oil refinery, the energy Ministry last week held a meeting with the participation of major manufacturers of gasoline — “Gazprom Neft”, “Rosneft” and LUKOIL. These companies recommended in the January—April 2017 to prioritize the delivery of gasoline to the domestic market,” confirmed RBC representative of the Ministry. In early November, the energy Ministry will hold a second meeting that “special attention” will be paid to the execution by the companies of the recommendations of the Department.
The Moscow oil refinery, which provides 40% of the market of oil products the Moscow region, annually processes approximately 10.5 million tonnes of oil and produces over 2.8 million tons of gasoline, 2.7 million tons of diesel fuel. At the time of repair of this plant, “Gazprom oil” will not export gasoline and will concentrate on supplying the domestic market, said RBC representative. According to him, during “routine repairs” supplies will be ensured by the formation of a reserve of petroleum products, purchase volumes in the market, the redistribution of the volume of other owned by “Gazprom oil” refineries (in Omsk and Yaroslavl), he adds.
“Rosneft” tries to fulfill its social obligations, but “in the framework of economic efficiency” business, said its press Secretary Mikhail Leontyev. With the beginning of the year, gasoline prices at retail rose less than the tax burden on refineries, he said.
In the presence of economic efficiency, the company also can redirect some of the fuel from exports to the domestic market and to increase gasoline production at the plant “Nizhegorodnefteorgsintez” (NORSI) to supply the Moscow region, said the representative of LUKOIL. Just last week, the FAS asked LUKOIL to increase production of gasoline at Norse for additional supply on the Moscow market. According to the Director of business development “Analysts commodity markets” Mikhail Turukalov, this plant on average produces 330 thousand tons of gasoline per month, but the plant is underutilized: at full load it is able to produce more than 400 thousand tons of gasoline.
Now gasoline inventories did not fully meet the demand in all regions of Russia, the press service of the Ministry. As at 24 Oct inventory of gasoline amounted to 1,485 million t. “This figure is about the same as last year”, — said the representative office. But independent traders disagree.
The current level of reserves corresponds to the winter of 2014-2015, right after the gas crisis of the summer and autumn of 2014, so the market may be a shortage, says the head of the Department of marketing and stock trading of the company “Mobil” Rinat Hantemirov. For the past two weeks, gasoline stocks fell by 6.6%, data from the Ministry of energy. Approximately a year ago, October 26, 2015, there were 8.4% more — of 1.62 million tonnes.
One of the main reasons for the reduction in inventory — supply of fuel for export, which is now much more profitable than selling in the domestic market, said Gantamirov. According to the energy Ministry, the export of gasoline in October 2016 totaled 186.7 thousand tons, an increase of 6.7% compared to last year. And deliveries to the domestic market, on the contrary, decreased by 12.9%, to 2.29 million tonnes.
Concerned customers have started to replenish their stocks of gasoline, which may continue the growth of wholesale prices on the exchange until at least mid-November, suggests Hantemirov. Over the last two days wholesale prices on the largest in Russia Saint-Petersburg international Mercantile exchange gasoline AI-92 and AI-95 grew by about 2.5% to 40,37 million and 42.7 thousand rbl. for 1 t, respectively.
The current situation with the growth of wholesale gasoline prices says about the artificial restriction manufacturers its supplies to the exchange, says Executive Director of the Russian fuel Union Grigory Sergienko. In his opinion, the replacement of 600 thousand tons of gasoline, which fall out of the market at the time of repair of the Moscow refinery, is possible only under the control of regulators — FAS and Ministry of energy. Otherwise it may be a petrol shortage, every oil company is guided, first and foremost, economic efficiency of supply, he warns.
Followed by wholesale stock prices, gasoline may be slightly more expensive in retail, believes Hantemirov — 0,2–0,4 rubles. per liter until the end of the year. According to the Moscow fuel Association, over the past two weeks the price of gasoline at the capital’s filling stations increased by only 2-3 kopecks to RUB 35,47 per liter of AI-92 and 38,38 rubles per liter of AI-95. The previously expected reduction of prices on gasoline at retail is not, but the price rise higher than a few cents, to the end of the year should not expect too objects analyst of the company “Algorithm fuel integrator” Victor Kostyukov: the demand for fuel at gas stations fell compared with the summer season. In addition to the regulation of prices in retail especially attentive FAS, so companies prefer to earn on wholesale prices, he adds.