Russian President Vladimir Putin has signed a law to amend the nation's tax code, a move aimed at boosting the domestic fuel supply. The legislative change introduces an excise tax mechanism designed to encourage the production of high-octane gasoline through blending, thereby increasing fuel availability across Russia. This initiative is a strategic response to fuel shortages exacerbated by Ukrainian drone strikes on energy infrastructure.
The new law is part of a broader governmental effort to address ongoing fuel supply issues and maintain energy resilience during geopolitical tensions. It allows for the mixing of straight-run gasoline with other components to produce high-octane automotive fuel. The volume of straight-run gasoline used in this process will be recognized as part of the produced automotive fuel, and the excise tax will be included in the cost of the final product.
Additionally, the law provides for the possibility of receiving a damping payment for both the production and import of automotive gasoline. For gasoline from Eurasian Economic Union (EAEU) countries, the compensation coefficient will increase from 0.68 to 0.9. For fuel from other countries, the compensation amount will be calculated based on the indicative price of AI-92 in the Indian market and transportation costs from Indian sea ports. The deadline for modernization agreements for oil refineries investing over $100 billion has also been extended until the end of 2026.
These tax amendments follow a directive from Deputy Prime Minister Alexander Novak on July 3 to oil companies to increase fuel supplies to meet domestic demand. Novak had previously characterized the fuel market situation as tense but under control, with measures being developed to boost summer supplies. All provisions related to additional motor fuel supply to the domestic market will apply to legal relations arising from June 1, 2026, while provisions concerning refinery modernization are retroactive to January 1, 2026.
The Russian government is also actively seeking to import fuel from other countries. Russia has reportedly begun importing gasoline from India, with at least 60,000 metric tons already dispatched. Sources suggest that Russia plans to import 400,000 tons of gasoline monthly from various countries, including Belarus, which has already significantly increased its gasoline rail supplies to Russia.
