Rosneft CEO Igor Sechin has proposed that Russian oil companies be required to refine at least 30% of their crude output domestically, aiming to ease a deepening fuel supply crisis. The proposal was outlined in a letter to President Vladimir Putin sent at the end of May, as reported by Russian daily Kommersant.
Sechin, who heads Russia's largest oil producer, argues the measure would alleviate domestic fuel shortages by ensuring a minimum processing threshold. The letter did not specify timeline or enforcement mechanisms, but the proposal targets a structural imbalance where much of Russia's crude is exported rather than refined at home.
Russia's fuel crisis has been exacerbated by reduced refinery runs and logistical bottlenecks, with some regions facing diesel and gasoline shortages. The 30% mandate would effectively lock in a portion of crude supply for local refineries, potentially reducing export volumes.
The proposal arrives amid broader energy market volatility. Oil prices have fallen to postwar lows despite low US crude inventories, as traders focus on improving Middle East supply flows and oversupply risks. This external price pressure complicates Russia's internal fuel dynamics.
Critics question whether mandating domestic refining could strain export revenues and trigger secondary market distortions, particularly if refineries lack capacity to absorb the required volumes. The Kremlin has not yet publicly responded to Sechin's letter.