The company states that due to shortages and sharp price increases, carrying out planned flights is no longer economically viable.
Russian aircraft (illustrative photo)
Russian airline “Azimuth” has announced a critical situation in the Russian aviation fuel market and has requested intervention from the country’s Ministry of Energy to stabilize the situation.
This information is being reported by Russian media, citing a communication from the carrier to the Association of Air Transport Operators.
According to the airline’s statement, at the beginning of June, the primary aviation fuel supplier indicated a necessity to reduce consumption by approximately one-third of the declared volumes, starting from the second half of the month.
The reasons cited include force majeure events at oil refineries, resulting in a reduction of aviation fuel supply in the market. “Azimuth” asserts that alternative suppliers also lack sufficient resources.
Concurrently with the fuel deficit, prices in Russian airports have escalated dramatically. The carrier reports that since the start of June, the average increase in aviation fuel costs has exceeded 17%.
In some instances, the price hike has been considerably more substantial. For example, in Makhachkala, the cost of kerosene, according to the airline, has risen by 64%, reaching 157,000 rubles per ton excluding VAT.
The company also highlighted that, conversely, global aviation fuel prices have been declining for the third consecutive month.
“Azimuth” has warned that under these conditions, executing the planned flight program “loses all economic sense.” According to the carrier, this affects not only international routes but, to an even greater extent, domestic flights.
Consequently, the airline has appealed to the Association of Air Transport Operators to approach the Russian Ministry of Energy with a request for measures to stabilize fuel prices for airlines.
Fuel Crisis in Russia: Latest News
The Russian fuel market has been experiencing increasing challenges recently. Amidst a decline in gasoline production, reduced oil product exports, and fuel shortages attributed to Ukrainian strikes, Russian authorities are exploring additional avenues to stabilize the situation.
According to industry sources cited by Reuters, gasoline production in Russia last week dropped by approximately a quarter compared to the average daily level in June of the previous year.
Due to fuel scarcity and subsequent price increases, Russian authorities are contemplating various strategies to support the domestic market. Among these options are subsidies for imported fuel, intended to help curb price rises.
Simultaneously, market sources and LSEG data indicate that in the first half of June, maritime exports of Russian oil products decreased by approximately 15% compared to the same period in May.
Earlier, Ukrainian drones struck the Moscow refinery twice. Following the impacts, a large-scale fire erupted at the facility, effectively halting its operations. The strikes damaged key installations and fuel storage tanks, which could have affected oil processing and fuel supply.
Against this backdrop, a fuel crisis has intensified in several Russian regions. In Moscow and the surrounding Moscow Oblast, reports have emerged of gasoline shortages, long queues at gas stations, and significant price hikes. According to Russian citizens, some stations only had diesel fuel remaining, and gasoline sales were restricted, for instance, to 30 liters per tank. In some locations, filling portable containers with fuel was also prohibited.
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