Gazprom Neft CEO: Protective duties on fuel could create surplus on domestic market; important not to unbalance refining

TYUMEN. Sept 20 (Interfax) - Protective duties on petroleum products could create a surplus on Russia's domestic market, though it is important to maintain a balance in refining, Gazprom Neft CEO Alexander Dyukov told journalists on the sidelines of the Industrial and Energy Forum in Tyumen.

"As a mechanism, protective duties on petroleum products in the short term could initially result in a surplus of fuel on the domestic market and a decline in wholesale prices. However, the consequences of this would be a decrease in the efficiency of refineries and, accordingly, a decline in refining volumes. If not calculated accurately enough, these measures could cause a shortage in motor fuel on the domestic market. It is important not to unbalance refining," Dyukov said.

Commenting on the matter regarding a list of special fuel exporters, Dyukov noted that, "This idea has the right to exist. However, it requires a thorough analysis in order to render a final decision."

"If a decision is taken to form this list, then [Gazprom Neft] will decide upon each enterprise individually. In this case, in any case, the domestic market always remains our priority," Dyukov added.

Answering why a fuel shortage has arisen on the Russian market, Dyukov said that, "Prices for oil and petroleum products are rising on the global market, while the ruble exchange rate has changed. This has resulted in a situation where the netback has exceeded domestic prices, thereby incentivizing various traders and exporters to buy fuel on the domestic market and export it to sell for a profit."

"The situation on the market has been really complicated. I would rather not comment on the actions of the government. We are in constant dialogue with them," Dyukov added.