Russia Hikes Petroleum Export Taxes

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Russias government has raised export duties on heavy refined petroleum products $5 per metric ton, which could impact motor oil prices, Itar-Tass reported last week. The increase will finance a new road construction and maintenance fund.

The increased export duties on light refined petroleum products such as gasoline and gasoil and heavy refined products such as base oils come because of a hike in crude oil export duties. The government ruling has increased the export duty on crude oil from todays $248.80 per ton to $263.80/t, the agency noted, adding that the export duty on oil from Eastern Siberia increased from the current $70 to $80/t.

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As a result, duties on light refined products grew from the present $180 to $190/t, and duties on heavy refined products rose from todays $97 to $102/t, according to state news agency Itar-Tass.
During the past three months, government officials asserted that the new measures wont affect the current market prices of petroleum products, although many domestic experts expect an increase of 3 to 5 rubles (10 to 17 cents) per liter for petrochemical products, including petrol, diesel and motor oils, Kommersant daily reported.
We hope that many oil producers would alleviate the effects of the duties price increase, hence the fuel prices as well the inflation wont advance heavily, Russian finance minister Alexey Kudrin told the newspaper.
Russias economy is heavily dependent on oil and natural gas exports. Russia is the worlds second largest oil exporter after Saudi Arabia. According to IMF and World Bank estimates, countrys oil and gas sector generated more than 60 percent of Russias export revenues in the last two years, and accounted for 30 percent of all foreign direct investment in the country.
The duty on propane, butane, ethylene, propylene, butylene, butadiene and other liquefied gas has already been raised from theprevious level of$20 to $37/t, the agency said.
The federal fund for road construction and maintenance will also receive money from a tax on cars, transportation minister Igor Levitin told Kommersant.

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