russian diesel

According to commodity price reporting agency Argus, Brazil is expected to import a significant amount of cheaper Russian diesel in April, accounting for 53% of the total diesel shipped to the country.

This is a significant increase compared to just 0.2% a year ago. The estimate takes into account expected shipments of Russian diesel brought in by 10 to 15 ships, which typically carry about 50,000 cubic meters.

Gabrielle Moreira, Argus diesel market specialist, stated that “Russian diesel arrives below the sale price of domestic refineries and below the value of the product imported from other origins, making it difficult to compete.”

The data gathered by Argus also indicates that the Russian product is gaining market share from U.S. diesel, which has traditionally accounted for most of the product imported by Brazil.

According to Sergio Araujo, the head of the Brazilian association of Fuel Importers (Abicom), Russian diesel arrives in Brazil at $0.20 to $0.30 cheaper per gallon than imports from other countries. He further mentioned that Russia has been expanding diesel exports to Brazil due to bans on the Russian product by Europe, a major buyer before Moscow launched its invasion of Ukraine last year.

Brazil has no import restrictions on Russian diesel, despite widespread international sanctions. However, some companies still avoid buying Russian fuel for fear of financial sanctions linked to compliance rules.

Brazil’s regional fuel distributors, many of them smaller, have taken advantage of the good prices of the Russian product to expand imports. In the first quarter of this year, Russia’s share of Brazil’s diesel imports increased to 13.2%, while the U.S. accounted for 33.1%.

In 2022, Brazil’s diesel imports were still dominated by the U.S. product, which represented 57.2% of the market, while Russia had just 1%, according to government data compiled by Argus.



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