MOSCOW: Russia plans to sharply increase fuel exports and carve out a larger share of the European market following an extensive $55 billion modernization of its refineries, companies’ plans and analysts’ reports show.
Russia embarked on a modernization of its biggest refineries in 2011 following a fuel shortage crisis. It also changed its tax system to favor production of cleaner and higher-quality fuel.
Russian think tank Vygon Consulting expects Russian primary oil refining volumes to rise by 8 million tonnes this year, matching a record high of 289 million tonnes reached in 2014 thanks to the modernization and rising oil prices.
The consultancy forecasts Russia’s exports of light oil products, including diesel, will increase this year to 106 million tonnes from around 95 million tonnes in 2017 as domestic consumption sags.
According to Russian oil pipeline monopoly Transneft, more than 38 percent of oil products from the Baltic Sea port of Primorsk, Russia’s key exporting outlet, goes to the Netherlands’ port of Rotterdam, followed by Germany (19 percent), the United Kingdom (15 percent) and France (11 percent).
According to the Primorsk data, it plans to ship 18.3 million tonnes of diesel this year, rising sharply to 19.8 million tonnes in 2019 and 23.9 million tonnes in 2020.