Alexela chief: US–Russia diesel deal unlikely to affect fuel prices in Estonia
Tarmo Kärsna, head of Estonian fuel company Alexela, says the deal announced by US President Donald Trump and Russian President Vladimir Putin to increase Russian diesel supplies is unlikely to directly change pump prices in Estonia. He says it may ease tensions on the American market.
The agreement between US President Donald Trump and Russian President Vladimir Putin to increase Russian diesel supplies may ease tensions in the American market, but it is unlikely to directly change prices at Estonian filling stations. That is the assessment given on Saturday by Tarmo Kärsna, head of the Estonian fuel company Alexela, in an interview with the portal Rus.ERR and the programme "Aktuaalne kaamera".
Sanctions remain in force
The United States has issued a temporary licence permitting transactions involving Russian diesel until April 2027. European sanctions remain in place, so imports of Russian diesel into Europe are still banned. Kärsna stresses that the US decision is unilateral and does not apply to Estonia. The first market reaction should be visible on Monday, he said, since Trump tends to make loud announcements on Friday evenings or at weekends, when markets are closed.
Russian exports have shrunk
By Alexela's estimate, Russia exported about two million tonnes of oil products per month at the start of the year, while the figure is now around 300,000 tonnes. Russian diesel exports have fallen roughly eightfold compared with January, according to the company. One reason is Ukrainian strikes on Russian oil refineries, which have forced plants to halt or temporarily suspend operations. The question, in Kärsna's view, is therefore how far Russia is able to increase exports at all.
Price outlook
The global market still faces a significant fuel shortage. Prices have so far been kept from rising further thanks to the G7 countries' decision to release strategic reserves. The market is also affected by the situation around the Strait of Hormuz and Russia's war against Ukraine. Resolving the conflict around the Strait of Hormuz would be one of the most important factors in overcoming the global energy crisis.
Kärsna also hopes for an end to the war in Ukraine, but does not expect a solution in the near future. He believes a clearer picture of how the global market will develop will emerge after the US midterm elections.
