Tax overhaul heaps pressure on Russian refiners

More expensive feedstock threatens independent operators

Russia's biggest oil tax overhaul in decades is having a profound impact on its refining sector, forcing operators to upgrade their plants or risk being forced out of the market. The changes introduced this year have also put pressure on domestic fuel prices—a politically sensitive issue—and could spur further consolidation of the industry. Russian refining margins have further weakened this year following the launch of Moscow's so-called 'tax manoeuvre'—a six-year plan to phase out export duties on crude oil and petroleum products and raise mineral extraction tax (MET). While the reforms will enable Russian oil exporters to better compete, they will also drive up the cost of domestic feedst