Refineries Restarting, But Fuel Remains Pricey

The country's biggest refineries are wrapping up a season of intensive maintenance, but oil product exports may not necessarily follow, as the country faces a deficit of some fuels and export duty rises, traders said.

TNK-BP's Ryazan and Saratov refineries, LUKoil's Nizhny Novgorod refinery, Rosneft's Komsomolsk and Angarsk refineries and a number of plants near Ufa have all completed maintenance in recent days, traders said.

Several of the refineries had cut crude runs to accommodate work on fuel production units, traders said.

Maintenance is still under way on one crude unit at LUKoil's Volgograd refinery. A gasoline-making catalytic cracker at its Perm refinery was due back on line early this week. Gazprom Neft's Omsk refinery and the Novoufimsky refinery are working on their hydrotreaters, traders said.

"I think there's less stuff coming out," a London-based fuel-oil trader said. "Prices on a domestic basis are very high, export taxes go up in December and the dollar is weak versus the ruble. ... It all contributes to fewer exports."

Export duties on light products will rise to $197.8 per ton from the current $181, while fuel oil exports will incur a duty of $106.6 per ton, up from $97.5.

Product prices, however, remain high and offers are slim, especially on some types of motor fuel.

Shortages have forced small-scale domestic-market participants to wait in line for fuel. Independent gasoline station operators were lining up at the gates of TNK-BP's Saratov refinery and, in some cases, camping out overnight in hopes of receiving small wholesale lots of fuel.