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Rosneft cuts diesel exports from key Russian port to zero

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FILE PHOTO: A logo of Russian state oil firm Rosneft is seen at its office in Moscow
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(Reuters) -Russian oil giant Rosneft is not scheduled to export any diesel from the Baltic port of Primorsk in May as demand from Europe was set to decline amid tightening sanctions on Moscow, traders said on Friday.

Exports of Russian diesel from Primorsk, a key supply source for Europe, are set to drop by over 30% in May from a month earlier to 1.114 million tonnes, data from traders showed on Friday.

Kremlin-controlled Rosneft has been one of the largest exporters of diesel from Primorsk, but the company had so far not planned to load any vessels in May, according to the data.

Trading sources said that Rosneft is diverting the excess diesel volumes to domestic markets with the conflict in Ukraine leading to higher demand for diesel.

Rosneft did not respond to a request for comment.

Although European Union sanctions have so far avoided targeting oil from Russia, its biggest supplier, many traders are expected to cut back buying sharply ahead of an EU May 15 deadline restricting oil purchases from major Russian oil producers to the amount "strictly necessary" for Europe's energy security, traders said.

At the same time, EU officials are preparing a sixth package of sanctions against Russia.

Switzerland-based trading house Trafigura was last year awarded a tender to buy all of Rosneft's diesel exports from Primorsk in 2022.

A source familiar with the matter said however that Trafigura would cut its buying of refined oil products from Rosneft by more than 80% as the trading house scales back purchases from Russia.

Trafigura declined to comment.

European diesel imports from Russia are set to fall in April but will still exceed those from other regions, highlighting the challenge European governments face as they contemplate new sanctions on Russian oil.

Europe is the destination for nearly half of Russia's crude and petroleum product exports, according to the International Energy Agency (IEA).

(Reporting by Ron Bousso and Julia Payne in London; editing by David Evans, Bernard Orr)

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