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Russia starts fuel exports to Iran by rail: sources

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2 years ago

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MOSCOW: Russia started fuel exports to Iran by rail this year for the first time after traditional buyers shunned trade with Moscow, according to three industry sources and export data.

Russia and Iran, both under Western sanctions, are forging closer ties in order to support their economies and undermine Western sanctions which both Moscow and Tehran cast as unjustified.

Western sanctions on Russian oil products over what Moscow calls its “special military operation” in Ukraine have reshaped global fuel markets with tankers taking longer routes and suppliers choosing exotic destinations and ways of transportation.

Iran has been under Western sanctions for years with limited access to global markets.

The oil ministries of Russia and Iran did not reply to requests for comment.

Last autumn, Russia’s Deputy Prime Minister Alexander Novak announced the start of swap supplies of oil products with Iran, but actual shipments only started this year, Reuters sources said.

In February and March, Russia supplied up to 30,000 tonnes of gasoline and diesel to Iran, two sources familiar with the export data told Reuters.

A third source confirmed the trade but was not able to confirm the volumes.

All the volumes were supplied by rail from Russia via Kazakhstan and Turkmenistan. One of the sources said that some gasoline cargoes were sent on from Iran to neighbouring states, including Iraq, by truck.

Iran is an oil producer and has its own refineries, but recently its consumption had exceeded domestic fuel production, especially in its northern provinces, a trader in the Central Asian oil products market said.

Russia had supplied small volumes of fuel to Iran by tanker via the Caspian Sea, as was the case in 2018, two traders familiar with the matter said.

Russian oil companies are currently interested in exporting diesel and gasoline to Iran by rail as exports by sea face high freight rates and a price cap imposed by the G7 countries.

However the rail exports face bottlenecks along the route, the sources said.

“We expect fuel supplies to Iran to rise this year, but we already see several issues with logistics due to rail congestion. That may keep exports from booming,” one of the sources familiar with supplies to Iran said.

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Robust activity lets PSX climb above 115,000 level again.

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On Friday, the Pakistan Stock Exchange (PSX) resumed its upward trend, crossing 115,000 points once more.

The PSX had strong action in the morning session, as the KSE-100 index increased by 1,000 points to 115,138.

The notoriously volatile PSX closed Thursday at 114,037 points, up 594 points.

DOLLAR DEPRECIES

Meanwhile, in the interbank market this morning, the US dollar fell 7 paisas to Rs278.65 against the Pakistani rupee.

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SBP will announce monetary policy on January 27.

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The State Bank of Pakistan (SBP) will release its monetary policy on Monday.

The Monetary Policy Committee (MPC) of the SBP will convene on the first day of the following week to make decisions on monetary policy.

The Monetary Policy decision will be announced by Governor SBP Jameel Ahmad at a news conference on the same day after the MPC meeting, according to an official release.

In December, the central bank reduced policy rates by 200 basis points (bps) to 13 percent.

“In November 2024, headline inflation fell to 4.9 percent year on year, meeting the MPC’s estimates. This decrease was mostly caused by the ongoing decline in food inflation and the phasing out of the impact of the gas tariff increase in November 2023,” SBP stated in an official release.

“However, the Committee noted that core inflation, at 9.7 percent, is proving to be sticky, while consumer and business inflation expectations remain volatile.” To that end, the Committee restated its previous assessment that inflation may remain volatile in the short term before stabilizing within the target range.

“At the same time, growth prospects have slightly improved, as evidenced by a recent increase in high-frequency indicators of economic activity.” Overall, the Committee concluded that its approach of gradual policy rate decreases is keeping inflationary and external account pressures under control while promoting long-term economic growth.

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Finance Minister Meets With World Leaders at World Economic Forum in Davos

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During his attendance at the World Economic Forum in Davos, Switzerland, Finance Minister Muhammad Aurangzeb has met with officials of organisations and leaders of many nations.
Bangladesh’s Chief Advisor, Muhammad Younas, met with Mohammad Aurangzeb.
On the fringes of the World Economic Forum’s Annual Meeting 2025 Opening Banquet, there was an informal meeting.
Additionally, the Finance Minister met with Anwar Ibrahim, the Prime Minister of Malaysia.
Both leaders discussed economic cooperation and bilateral ties.
Muhammad Aurangzeb also had a meeting with Dp World’s Rizwan Soomro and Yuvraj Narayan.
They talked about how to strengthen Pakistan’s logistics and infrastructure systems to support trade.
“The Pakistani government is committed to advancing joint projects and values partnerships in both business-to-business and business-to-government cooperation,” the finance minister added.

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