Russia to Cut Crude Export Duty Next Month on Urals Drop

Russia, the world’s biggest oil producer, will reduce its export duty on most crude shipments by 2.6 percent from May 1 after Urals prices dropped.

The standard duty will fall to $448.60 a metric ton, or $61.20 a barrel, from $460.70 a ton in April, according to an order signed by Prime Minister Vladimir Putin and published today on the government website. The discounted rate on some Eastern Siberian and Caspian Sea oil will drop to $232.40 a ton, compared with $241.50 this month.

Russia bases the export duties on the average Urals crude price from the 15th day of one month to the 14th of the next. Urals, Russia’s benchmark export blend, averaged $120.76 a barrel during the most recent period, Alexander Sakovich, a Finance Ministry adviser, said by phone on April 16. In the previous monitoring period, the crude price averaged $123.53, according to the ministry.

The government lowered the crude tax rate in October, applying a coefficient of 60 percent, down from 65 percent, and unifying the duty on most refined products at 66 percent of that levy.

The duty for middle distillates and heavy products will fall to $296 a ton next month, from $304 in April.

A gasoline tax that Putin imposed in May 2011 to counter domestic shortages will fall to $403.70 a ton from $414.60 this month. That is 90 percent of the crude duty. The government will raise the duty on liquefied petroleum gases such as butane and propane to $196.60 a ton from $158.60 this month.

To contact the reporter on this story: Jake Rudnitsky in Moscow at jrudnitsky@bloomberg.net

To contact the editor responsible for this story: Stephen Voss at sev@bloomberg.net

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