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Russian oils ask the government to reduce gasoline export duty

According to Vedomosti, Russian oil companies have asked the government to reduce export duty on gasoline (currently 90% of crude oil export duty). The paper also quotes the Ministry of Energy saying that despite high export duty, gasoline exports amounted at 3.59mnt in 2012, increasing 17.3% YoY.

An increase in export volumes relates to the increase in the output of nonmarketable straight-run gasoline. So overall, we do not see any significant growth in exported volumes of marketable gasoline. In terms of a reduction of export duties for gasoline, we do not expect to see any easing on this direction, given the shortage of supply on the domestic market and the recent ban on gasoline of lower than Euro 3 quality. To recap, if the price of Urals goes below USD 95/bbl, export duties might be reduced to 66%, as was announced previously by the Ministry of Energy; however, even in this case, we expect the domestic premium for gasoline to remain in place, making the export route non-profitable for Russian oils. 

Dmitry Loukashov, Alexander Kirevnin, Ekaterina Rodina, Elena Kopylova, Mikhail Zarkhi
VTB Capital analyst

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