Government considering proposal for a moratorium on zeroing out the fuel damper

MOSCOW. October 14. INTERFAX.RU - The Russian government is considering a proposal to introduce a moratorium on zeroing out the fuel damper, Russian Deputy Prime Minister Alexander Novak told journalists.

"Yesterday the proposal was voiced at the headquarters meeting. Now we will discuss it together with the federal authorities, with the Ministry of Energy. On the whole, the proposal is being considered," he said.

The damper mechanism has been in effect in Russia since 2019. The budget pays the damper to oil companies as a kind of subsidy so that they restrain domestic fuel prices when export netbacks are high. It is calculated as the difference between the export price and a conditional (normative) domestic price fixed in the Tax Code (para. 27, art. 200). However, if the average exchange price for a month exceeds the normative one (by 20% for gasoline and 30% for diesel), the damper is not paid.

In the autumn of last year, Russian President Vladimir Putin introduced a moratorium on zeroing out the fuel damper - from October 2025 to May 1, 2026. The decision was made against the backdrop of record-high fuel prices on the St. Petersburg exchange due to scheduled and unscheduled refinery repairs.

The indicative price for gasoline for 2026 is 62.3 thousand rubles per ton, and for diesel - 58,950 rubles per ton, meaning oil companies may not receive payments if the average monthly exchange price of gasoline exceeds 74,760 rubles per ton, and diesel - 76,635 rubles per ton.

In the draft budget under consideration, the Finance Ministry proposed raising the indicative prices for 2027-2028: for gasoline in 2027 - from 77,040 rubles to 79,620 rubles per ton, and in 2028 - from 79,320 rubles to 82,800 rubles. For diesel, the threshold in 2027 will rise from 78,975 rubles to 81,640 rubles, and in 2028 - from 81,380 rubles to 84,890 rubles. In 2029, the thresholds will be 86,100 rubles for gasoline and 88,270 rubles for diesel.