2020 May 18
South Korea has started exporting diesel to Russia due to a quirk in the latter's tax system that makes it cheaper for Russians to import fuel than buy locally.
A local tax scheme requires Russian oil firms to make higher payments to the government, which raised domestic oil prices despite excess supplies caused by the pandemic.
Consequently, imported diesel could be $337 less per ton than on the local market.
According to an industry insider, the Mercury tanker had brought in 1,500 tons of diesel from Busan, South Korea to Vladivostok, Russia.
Meanwhile, Refinitiv Eikon, a financial market data provider, revealed that the Zaliv Vostock tanker arrived at the port of Nakhodka 9 Russia on May 12, carrying 4,000 tons of diesel from the port of Yangshan, China.
The prices of the cargoes have not been disclosed.
Since, maintenance works are also being done at some Russian refineries, including at Khabarovsk and Komsomolsky plants, it is more convenient for some groups to import fuel.
The fuel importation may be short-lived, as Russia plans to ban the import of fuels.