Russian refiners continue increasing their ULSD production as new desulphurisation and conversion units are brought online (see FSU/CEE Insight – Issue 10).

  • Gas oil/diesel supplies are expected to come under some pressure next month, with heavy maintenance taking its toll. We expect 1 million b/d of CDU capacity to be offline in the country in April, up 450,000 b/d m-o-m and 200,000 b/d higher y-o-y.
  • We expect domestic gas oil/diesel demand in Q1 to be higher y-o-y, as a result of buyers taking into consideration the upcoming hike in diesel excise duties (+28%) in April. Q2-Q4 figures will decline somewhat y-o-y, bringing the 2016 average in line with last year’s level (SuDeP).
  • Exporters of 10ppm diesel from Russia are increasingly utilising export routes other than the pipeline to Primorsk, as it has been running at its nameplate capacity for some months now.