22 Nov 2018 18:01

Transneft never planned to create interventional funds for fuel market stabilization

MOSCOW. Nov 22 (Interfax) - Transneft has never expressed or discussed proposals on the creation of interventional funds for stabilization of the fuel market, Advisor to the President of Transneft and press secretary Igor Demin told Interfax.

"Our pipelines carry a client's product with particular ownership. This product cannot be used against digital warehouse receipts or something else for damping demand in the market," he said.

Furthermore, the Transneft system contains technical volumes of petroleum products which are part of the system which provides for pumping of oil. "These volumes cannot be withdrawn even virtually, since this will disrupt the overall operating process," he said.

Any commodity product market should have a safety cushion which can be used, Kirill Molodtsov, an aide to the head of the presidential administration, told reporters on the sidelines of the Exchange Commodity Market-2018 forum organized by the St. Petersburg International Mercantile Exchange (SPIMEX). "Transneft has now articulated that it has actual capacity in the daily storage pipeline. It's clear that these are actual volumes. This is the damping volume which can be used in the form of digital warehouse receipts for the state to engage in damping demand on the market," he said.

"Thus, are the instruments have essentially been created. Transneft and Transneftproduct are essentially now participants in the market, they are essentially within the legal framework. They have evidently already been mentioned in clearing or in something else. All the mechanisms have been created, and objectively, we can create the actual damping volumes of state reserves, which is not a State Reserve, this is, this is a damping volume, where the state acts like a market participant," Molodtsov said. This will be discussed, he said.

At the same time, Transneft responded to the corresponding submission from Molotsov as early as in the summer, saying that the use of the company's reservoir tank storage as infrastructure for long-term storage of petroleum products was not possible. "Transneft's pipeline operation control stations and filling points include reservoir tank storage facilities which are necessary for carrying out technological operations aimed at accumulation batches of petroleum products for their further transport after accepting volumes from refineries and delivery to freight dispatchers at tie-in facilities Thus, the purpose of reservoir storage facilities is determined by the technical features of petroleum product transport via pipelines," the company said.