Wholesale gasoline prices in Russia began to decline in October, according to data from trading on the St. Petersburg International Mercantile Exchange (SPIMEX).

The price of 1 ton of AI-92 gasoline in the European part of Russia (the most liquid exchange index) fell to a monthly low of 59,356 rubles as of October 22. This marked the third consecutive decline in the price since October 17, with a 2% drop during this period. Compared to the local peak of 62,487 rubles per ton set during trading on September 6, AI-92 gasoline has decreased by 5%.

The exchange price of AI-95 gasoline is also declining. As of October 22, the wholesale price of this grade of gasoline in the European part of Russia stood at 63,521 rubles per ton, the lowest level since June this year. Since October 17, the price has decreased by 2%, and compared to the monthly peak of 73,864 rubles per ton on September 5, it has fallen by 14%.

The price of diesel fuel on the exchange is showing a slight decline. Summer diesel fuel has decreased by 0.6% to 60,600 rubles per ton since the beginning of October, while the interseasonal type has dropped by 0.2% to 60,913 rubles per ton. The price of winter diesel fuel has fallen by 3% since the start of the month, but it has remained stable over the past week.

As reported by Vedomosti, in September, the exchange price of AI-92 gasoline in Russia reached its highest level since the fall of 2023, and the price of AI-95 gasoline reached its highest point since the summer of this year. Prices increased despite government efforts to stabilize the fuel market.

In particular, since August 1, Russia reinstated a ban on gasoline exports. The restriction does not apply to shipments under intergovernmental agreements or humanitarian supplies.

The ban, originally set to begin on March 1, 2024, for six months, was lifted for a period from May 20 to June 30, and a similar decision was made for shipments in July. The restriction was reintroduced in August. Pavel Sorokin, Deputy Minister of Energy, explained the reinstatement of the ban due to the risk of fuel shortages during the scheduled maintenance season at refineries. In mid-August, the government extended the ban from September 1 until the end of the year.

The trend of falling exchange prices for gasoline is expected to continue in the coming months, according to Alexander Kotov, head of consulting at Neft Research. He believes that this will be driven by seasonal demand declines, the completion of planned and unplanned maintenance at most large refineries, and the export ban. Additionally, the situation with the shipment of petroleum products from refineries to railroads is gradually normalizing.

Sergey Tereshkin, CEO of Open Oil Market, attributes the current drop in wholesale prices to oil companies' efforts to stabilize retail prices and lift the export ban on gasoline. He notes that up to 20-25% of all gasoline produced in Russia is currently traded on the SPIMEX. The exchange's regulatory minimum for refinery trading is 15% of gasoline production and 16% of diesel.

At gas stations, the price of motor fuel continues to rise moderately, slightly outpacing inflation. According to Rosstat, from October 7 to 14 (the latest available data), the price of 1 liter of AI-92, AI-95 gasoline, and diesel fuel increased by 0.1% on average to 53.61 rubles, 58.88 rubles, and 67.09 rubles, respectively. Since the beginning of the year, the price of AI-92 gasoline at gas stations has risen by 6.6%, AI-95 by 7.2%, and diesel by 3.6%. Inflation in Russia since the start of the year, as of October 14, stands at 6.06%.

According to Sergey Kaufman, an analyst at Finam, wholesale gasoline prices may fall by another 10-15% by the end of the year. Evgeny Mironyuk, a stock market expert at BCS World of Investments, notes that wholesale prices on the over-the-counter market are not yet declining as significantly. Therefore, he believes it is more accurate to talk about stabilization rather than a price decrease.

There are no systemic factors indicating a return to rising fuel prices at the moment, according to Kotov. Kaufman suggests that wholesale prices could start rising again if the export restrictions on gasoline are lifted earlier than planned or if new accidents occur at refineries. Tereshkin believes that oil companies will keep gasoline and diesel prices in check until the end of the year, but a price surge may occur in early 2025 due to the lifting of the export embargo and the annual excise tax increase.

Fuel prices at gas stations will continue to rise slowly, following inflation, according to Kotov. He believes that gas stations have returned to a "relatively normal" level of profit due to the drop in wholesale prices. Kaufman expects a slowdown in retail price growth as the wholesale market stabilizes. Mironyuk does not expect significant changes in price dynamics at gas stations.

Vedomosti has sent a request to the Ministry of Energy.


Translated using ChatGPT.


Source: https://www.vedomosti.ru/business/articles/2024/10/22/1070307-optovie-tseni-nachali-snizhatsya?from=.