Russia to lower crude export tax 4.5%

By Jake Rudnitsky & Marina Sysoyeva
Bloomberg News

Russia, the world’s biggest energy exporter, will reduce duties on most crude and oil product shipments overseas by 4.5 percent on April 1, down from a 10- month high, after a drop in benchmark Urals prices.

Standard export duty will decline to $401.50 a metric ton, or about $54.77 a barrel, from $420.60 a ton this month, according to an order published on a government website today. The March tariff was the highest since May 2012.

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The government is reviewing its export duty structure to encourage producers to meet President Vladimir Putin’s goal of pumping more than 10 million barrels a day. Output was 10.45 million in February, close to a post-Soviet high, according to data from the Energy Ministry’s CDU-TEK unit. Oil and gas provide about half of Russia’s budget revenue.

The discounted rate on some eastern Siberian and Caspian Sea grades will drop to $197.10 a ton from $211.40 this month. The levy on extra-heavy crude, set at 10 percent of the standard duty, would be $40.10 in April.

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Russia bases the export taxes on the average Urals blend price from the 15th day of one month to the 14th of the next. The grade averaged about $110.02 a barrel during the most recent period, Alexander Sakovich, a Finance Ministry adviser, said March 15. In the previous monitoring period, it was $114.38, according to the ministry.

Duty for middle distillates, such as diesel, and heavy products, such as fuel oil, will fall to $265 a ton from $277.60. A gasoline tax, set at 90 percent of crude since May 2011 to counter domestic shortages, will be reduced to $361.40 a ton in April from $378.60 this month.

The government will lower the duty on liquefied petroleum gases such as butane and propane to $70.50 a ton from $131.40.