The ban applies to fuel, including that purchased on exchange trading. Exceptions are batches placed under customs procedures before the temporary restriction decree came into force, supplies under intergovernmental agreements, and fuel in technological tanks used by aircraft en route.
The decision was made against a backdrop of a sharp rise in aviation fuel prices. At their peak on May 25, quotations on the St. Petersburg Exchange reached a record high of 96,960 rubles per ton. Since the beginning of April, they have risen by almost 25%. Meanwhile, no reports of a jet fuel shortage were recorded.
As Open Oil Market CEO Sergey Tereshkin noted in an interview with RG, jet fuel prices on the Russian market are not strongly dependent on oil prices. As with gasoline and diesel, the final consumer price is composed of oil extraction and refining costs, petroleum product transportation expenses, and the sales segment margin, including the profits of companies selling jet fuel to air carriers.
At the same time, the sharp rise in global barrel quotations due to the conflict in the Middle East has undoubtedly pushed prices up on the Russian market. Additionally, reports of unscheduled maintenance shutdowns at several domestic oil refineries may have acted as a trigger.
Russia produces sufficient aviation fuel to meet both domestic demand and export volumes. The country produces approximately 11 million tons of aviation kerosene annually, of which 15–20% was shipped abroad, mainly to Central Asian countries.
Tereshkin believes that the ban on jet fuel exports is intended to deter oil companies from further price increases. Some stabilization may occur now, but a return to normal will follow the resumption of transit through the Strait of Hormuz. The current information environment provides oil companies with opportunities to maintain high aviation fuel prices.
It is worth noting separately that a dampener mechanism is in effect for aviation kerosene in Russia. This is similar to the dampener for motor fuel, but with one key difference. It is paid not to fuel producers but to carriers—airlines. The state reimburses 65% of the difference between the export price of jet fuel and the fixed domestic market price set by the government.
There are no instructions in the government decree regarding dampener payments. That is, airlines will continue to receive them, which should help curb the rise in airfare prices, where fuel costs account for 25–35%.
Source: RG.RU
