Novak eyes 3.5M tons of monthly Russian diesel exports

A tanker carrying about 40,000 metric tons of Russian ultra-low sulphur diesel loaded at the Baltic port of Primorsk on Oct. 13 and is heading toward Morocco, Reuters Thomson Reuters Corporation ↗ 1.04% reported, citing shipping data from LSEG London Stock Exchange Group plc. It is the first visible cargo since Moscow partly lifted its diesel export ban on Oct. 10. The shipment shows the fuel deal that President Donald Trump announced with Vladimir Putin on Oct. 9 is starting to work. Washington wants lower diesel prices before the Nov. 3 midterm elections, but the early volumes are small.al-monitor.com

"The diesel has started reaching global markets and is expected to have a positive effect on stabilising oil markets, although it will not be enough to fully stabilize them," Kremlin spokesman Dmitry Peskov told reporters on Thursday, Oct. 15, according to Reuters.al-monitor.com

What remains unclear

The shipping data did not name the vessel, the buyer or the Moroccan port where it will unload, Al-Monitor reported. That leaves open whether the fuel is meant for Morocco's own market or will be shipped on, Hespress noted. Moscow brought in the ban on July 8 to protect domestic supply after Ukrainian drone strikes damaged its refineries, and extended it several times before easing it this month.al-monitor.com+1

Novak's targets

Speaking at Russian Energy Week on Oct. 15, Deputy Prime Minister Alexander Novak said the first deliveries to the United States could come "in at least 2-3 weeks." He said a contract has to be signed, the fuel loaded and a vessel chartered first, Russia's state news agency TASS reported. Russian companies are ready to load as soon as contracts are signed, but commercial terms are still being negotiated.tass.com+1

On Oct. 16, Novak said the global diesel shortage is about 25% of world trade, mainly because supplies from the Persian Gulf cannot reach international markets. He said Russian exports could reach 3.5 million tons a month by the end of the year, according to TASS.tass.com

Small volumes, strong criticism

Trump said Russia would supply more than 300,000 tons right away, then 500,000 tons in November and 1 million tons "immediately thereafter." The U.S. Treasury has waived sanctions on Russian diesel through April 2027, CNBC Comcast Corporation ↗ 0.60% reported. The first 300,000 tons, about 2.25 million barrels, is less than one day of U.S. transport-sector demand, according to Energy Information Administration data cited by Reuters.cnbc.com+1

Ukrainian President Volodymyr Zelenskiy, European officials and some Republicans have strongly criticized the deal. Moscow called European objections "cynical," since Europe still buys some Russian oil and liquefied natural gas. The Financial Times reported that the administration is also considering easing sanctions on Russia's "shadow fleet" of tankers to bring prices down. Consultancy Energy Aspects warned that the fleet's aging ships would add little shipping capacity in the short term, Asia Business Daily reported.reuters.com+1