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Russia blocks the export of diesel and petrol. In Europe the price explodes

At a time when prices of automotive diesel and fuels in general are already high, Russia has “temporarily banned” diesel exports in a bid to stabilize domestic supplies, adding pressure to already tight global fuel markets and putting Christine Lagarde and Ursula Von Der Leyen are in great difficulty, because the decision will step on the accelerator pedal of inflation, causing economic and political problems.

“Temporary restrictions will contribute to saturating the fuel market, which in turn will reduce prices for consumers” in Russia, the government press office said on its website. The "temporary" ban, which also applies to petrol, comes into force today, September 21, and does not have a definitive date, according to the government decree, signed by Prime Minister Mikhail Mishustin.

There are exemptions for smaller supplies, including deliveries to some trade alliance partners, as well as humanitarian aid and transit, the decree said. However, minimal quantities.

Prices in Europe have jumped on the threat that the measure could worsen already staggering global shortages. The world's oil refineries are struggling to produce enough fuel due to limited crude supplies from Russia and Saudi Arabia. Of course, this means that the refineries will push prices significantly higher and – in the jargon of Joe Biden's handlers – print money again, i.e. do a roaring trade.

In northwestern Europe, the premium of benchmark diesel futures to crude oil – known as crack ICE Gasoil – rose sharply, above $37 a barrel, and at its fastest pace in a year.

Diesel futures for October delivery also became more expensive than barrels for delivery in the following month, with Backwardation topping $35 a ton. Brent crude also rallied, reversing nearly all of yesterday's losses.

Not that prices at the pump aren't already skyrocketing, both in Europe

Both in the USA

In fact, what Russia is doing by blocking product exports is exporting higher prices to Europe and the West in general.

Rising car fuel prices have been a major contributor to inflation, a potential political headache as the Kremlin prepares for presidential elections in March. According to the most recent data from the Federal Statistics Service, retail prices of gasoline and diesel in Russia increased by 9.4% from the beginning of the year to September 18, compared to an increase in overall consumer prices of 4%.

The Russian government has spent weeks in talks with oil producers to decide on measures to curb rising fuel prices. President Vladimir Putin said last week that officials and companies had agreed on how to act going forward, but disputes continued, sources told Bloomberg.

In the first 13 days of September, Russia exported on average about 63,000 tons of diesel fuel per day and just over 8,000 tons of gasoline per day, according to a person familiar with the matter. Daily diesel exports fell 31% from the average for the first 30 days of August, as refineries underwent seasonal maintenance and producers redirected more of the fuel to the domestic market following government efforts to lower prices. prices.

Russia will lower domestic prices and send European ones skyrocketing. We will be green, broke, for real.

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The article Russia blocks the export of diesel and petrol. In Europe the price explodes comes from Economic Scenarios .

This is a machine translation of a post published on Scenari Economici at the URL https://scenarieconomici.it/la-russia-blocca-lexport-di-gasolio-e-benzina-in-europa-esplode-il-prezzo/ on Fri, 22 Sep 2023 05:00:29 +0000.