Additional sales of Russian diesel will not significantly reduce prices

The agreement reached between the US and Russia on diesel will not quickly resolve the existing shortage in the market. According to analysts' estimates, the planned volume will not be sufficient to significantly reduce prices. At the same time, problems at Russian oil refineries do not allow the country to rapidly increase exports.

According to Donald Trump's statement, in the first stage Russia will sell 300,000 tons of diesel. In November this should be supplemented by 500,000 tons, and later by another million tons.

If the first 300,000 tons are spread over one month, the daily volume will be approximately 73,000 barrels. According to Kpler's estimate, about 400,000 barrels more diesel per day are needed to noticeably reduce prices.

Russia also struggles to rapidly increase sales. Several oil refineries are not operating at full capacity, and due to threats in the Black Sea, transportation has become more expensive. In addition, after satisfying domestic market demand, relatively little remains for export.

The decline in supply from Russia and the Middle East reached 1.3 million barrels per day in September. The International Energy Agency does not rule out that the shortage could continue until 2027.

Source: Reuters