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Oil prices rise on Russian restrictions

Moscow has banned exports of gasoline and diesel to stabilize the domestic fuel market

Global oil prices climbed higher on Friday as Russia’s ban on diesel and gasoline exports raised concerns about tightening supplies.

Brent futures had climbed above $94 per barrel by 11:30 GMT, while US West Texas Intermediate crude (WTI) gained roughly 1% to trade over $90 per barrel. Both benchmarks were expected to see an insignificant weekly drop after gaining over 10% in the previous three weeks.

On Thursday, the Russian government introduced a temporary ban on foreign sales of diesel and gasoline in order to stabilize the domestic fuel market.

According to the Kremlin, the measure does not apply to fuel supplied under inter-governmental agreements to members of the Moscow-led Eurasian Economic Union, which includes Belarus, Kazakhstan, Armenia, and Kyrgyzstan.

“Temporary restrictions will help saturate the fuel market, which in turn will reduce prices for consumers,” the government’s statement read.

According to the Russian Energy Ministry, the step will also prevent unauthorized “gray” exports of motor fuels.

READ MORE: Russia restricts fuel exports

Russia has faced a spike in wholesale fuel prices in recent months due to shortages of gasoline and diesel. The situation has particularly affected southern regions, where fuel is crucial for gathering the harvest. 

The previous surge in global oil prices was attributed to concerns over tightening supply as the Organization of the Petroleum Exporting Countries and its allies, known collectively as OPEC+, maintain production cuts.

For more stories on economy & finance visit RT’s business section

September 22, 2023 at 05:30PM

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