Export ban and increased export duty can reduce price for diesel fuel and gasoline - Nar Oil

energy

Export ban and increased export duty can reduce price for diesel fuel and gasoline - Nar Oil

By SRI ⋅ July 31, 2008 ⋅

(SRI) - Temporarily banning exports and increasing export duties on oil and petroleum products can reduce price for combustive-lubricating materials (CLM), said Sultan Ushbayev, the chairman of the Board of Directors of oil industrial group Nar Oil, according to Kazakhstan Today.

Ushbayev said that recently the Minister of Energy and Mineral Resources of Kazakhstan Sauat Mynbayev stated that monthly production of diesel fuel totals on average about 340 thousand tons, 130 thousand tons of which is used at fixed prices for the needs of agricultural manufacturers. “The Minister of Agriculture said that as of July 11 only 19 thousand tons has been shipped,” Ushbayev told Kazakhstan Today.

“If we close the borders up to the end of the year, those who planned to export will start selling the stocks of mineral oil in the domestic market, which will decrease the price. In this case, collective farmers can harvest buying diesel fuel at the affordable prices. Some may even create their own stock of diesel fuel for the next year,” Ushbayev explained.

“Oil is exported without restriction through Ukraine to Europe without payment of export customs duties. Oil exporters need to pay customs duties, which in Kazakhstan, in comparison with world prices for oil, are very low. Export customs duties affect prices. If they are low, the stocks will be exported outside of Kazakhstan.”