Russian refineries ramp up diesel output after US deal, sources say

Two sources in Russia’s oil industry said refineries had raised diesel output in October following the government’s issuance of export quotas under a fuel supply agreement with the United States.

On October 9, U.S. President Donald Trump said Russian President Vladimir Putin had agreed to a deal to supply Russian diesel to the United States and global markets. Under the agreement, Washington would temporarily suspend sanctions related to Russian fuel.

Russia also confirmed the agreement. Trump said Moscow would initially deliver more than 300,000 metric tons of diesel, equivalent to about 2.25 million barrels. A further 500,000 metric tons would be supplied in November, followed by another 1 million metric tons immediately afterward.

Trump also said Russia would supply an additional 3 million metric tons of diesel, depending on the condition of its refineries.

Production rises after export quotas are issued

According to traders, the Russian government introduced exemptions to the existing diesel export ban from October 1, allowing specified export quotas to be issued to facilitate implementation of the fuel agreement with the Trump administration.

Since Russia’s diesel export ban came into effect in August, oil companies have been forced to adjust production to meet domestic demand. During the same period, fuel supplies to Central Asian countries were also restricted under intergovernmental agreements.

Industry sources said Russian diesel production fell to around 160,000 metric tons per day in the first half of October, down from approximately 175,000 metric tons per day in September.

Following the issuance of new export quotas in mid-October, production began to recover, reaching nearly 180,000 metric tons per day.

How much surplus diesel does Russia have?

According to industry sources, domestic diesel consumption in Russia typically falls to around 140,000 metric tons per day in October. The end of the agricultural harvest and a seasonal decline in road travel after the summer months contribute to the reduction.

At the reported production rate, Russia could therefore have at least 40,000 metric tons of diesel available for export each day, amounting to more than 1 million metric tons over a month.

However, some of this fuel would need to be allocated to neighboring countries. The sources estimated that approximately 200,000 to 300,000 metric tons of the available volume might be required to meet demand in those markets.

Industry sources also expect the Russian government to maintain the formal export ban rather than lift it entirely, relying instead on a quota system to regulate shipments abroad.

Under this approach, the government would monitor domestic market conditions and changes in production levels to determine the volume of diesel that could be exported.

Has the first shipment of Russian diesel reached New York?

Data from LSEG showed that an oil tanker flying the Maltese flag and carrying 40,000 metric tons of Russian diesel, with New York listed as its destination, appeared in vessel-tracking systems on October 23.

Kremlin spokesman Dmitry Peskov also said on the same day that Russian diesel shipments to the United States would continue regularly following the departure of the first tanker.

The developments suggest that the Moscow-Washington agreement has moved beyond political announcements, with at least one shipment reportedly on its way along the declared route.

However, the information cited in the Reuters report refers to the vessel’s appearance in tracking systems. It does not, on its own, confirm that the cargo was unloaded in New York./reuters