Russia Reverts to 13-Year-Old Fuel Standards Amid Crisis, Damaging Engines

Russia is preparing to roll back fuel standards by 13 years, allowing the production and trade of gasoline and diesel adhering to Euro-2, Euro-3, and Euro-4 classifications. This measure, detailed in a draft government regulation obtained by "Kommiersant," is intended to increase the supply on the domestic fuel market and is slated to remain in effect until July 2027. The methanol content in gasoline will be capped at 3 percent, and imports of lower-class fuels will be permitted without adhering to the technical regulations of the Eurasian Economic Union.

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The content of methanol in gasoline will be limited to 3 percent. The import of lower-class gasoline will be allowed, but it will not be subject to the technical regulations of the Eurasian Economic Union.

This decision follows a severe fuel crisis triggered by Ukrainian drone attacks that have halted operations at Russia's 10 largest refineries. Market participants report a significant drop in gasoline reserves over the past three months. To stabilize the market, the Russian government has already banned gasoline exports until July 31 and may extend restrictions on diesel exports. Gasoline sales on the exchange have also been reduced, and a zero import duty on gasoline into the EAEU is set to be extended.

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In the case of Euro-2, fuel sulfidation jumps 50-fold – up to 500 mg/kg. Euro-2 gasoline also allows for a higher benzene content, while diesel fuel can have a lower cetane number – a characteristic affecting combustibility.

The return of lower-standard fuels, particularly Euro-2 gasoline which has been banned in Russia since 2013, raises significant concerns. Euro-2 gasoline allows for a 50-fold increase in sulfur content compared to Euro-5 standards, up to 500 mg/kg, and permits higher benzene levels. Diesel fuel under Euro-2 can have a lower cetane number, affecting its combustibility. Experts suggest that allowing the use of kerosene as a base oil without deep refining could significantly boost gasoline production, potentially by hundreds of thousands of tons monthly, and facilitate cheaper imports. However, it is unlikely to fully compensate for the shortages.

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The introduction of kerosene could increase gasoline production by hundreds of thousands of tons per month, opening up possibilities for importing cheaper fuel.