Finance
Russia hunts for new naphtha markets as key buyers pull back
Published by Global Banking and Finance Review
Posted on January 28, 2026
3 min readLast updated: January 28, 2026
Global Banking and Finance Review
Company
Published by Global Banking and Finance Review
Posted on January 28, 2026
3 min readLast updated: January 28, 2026
Russia's naphtha exports face declines as U.S. sanctions deter key buyers. Moscow seeks new markets while managing storage and re-export challenges.
By Mohi Narayan and Natalia Chumakova
NEW DELHI/MOSCOW, Jan 28 (Reuters) - Russia's naphtha exports to Asia are set to fall in January, with volumes in storage swelling as U.S. sanctions pressure key buyers including Taiwan, India and Venezuela, forcing Moscow to seek new markets, traders and analysts said.
Buyers have become more cautious after Washington imposed sanctions on top Russian oil producers, forcing sellers to hold naphtha on ships or in storage abroad from where it can be re-exported, often with the destination obscured.
"Everybody is going to be extra cautious this year when it comes to buying sanctioned cargoes," said Armaan Ashraf, director of natural gas liquids and Asia oils at FGENexant.
This means premiums on "legitimate" barrels of heavy full-range naphtha will rise or discounts on Russian cargoes will widen, he added.
Russia exports heavy full-range naphtha which is processed at reformers into aromatics for gasoline blending or to make petrochemicals.
EXPORTS DOWN
Russia typically exports 1.4 million to 1.5 million metric tons of naphtha per month, but the volume is falling as the Tuapse refinery and Taman port are shut for repairs after repeated Ukrainian drone attacks.
The Tuapse refinery, which exports around 150,000 to 200,000 tons of naphtha per month, halted processing on December 31 and will take another month to restore production to normal, market sources said.
Russia's naphtha exports to Asia could fall to about 600,000 tons in January, preliminary data from a shipping source showed, down from about 800,000 tons in December.
In January and February, Asia's naphtha imports from Russia could drop to 700,000 to 800,000 tons, according to preliminary estimates from three Singapore-based traders, about 30% lower than the 1 million to 1.2 million tons monthly average in the first 10 months of 2025.
Taiwan and India, two key Russian naphtha buyers, slashed imports in December after producers Rosneft and Lukoil were hit by U.S. sanctions.
RE-EXPORTS
Tankers carrying around 350,000 tons of naphtha loaded from Russian ports in December show Singapore as the destination as of January 22, while others with more than 320,000 tons did not declare final destinations, data from the shipping source showed.
Some cargoes that loaded in December remain unsold on water, traders added.
"Russian barrels will be clearing in re-exporting sites like Karimun in Indonesia, some of it could land in the Singapore straits, or even north or west African commercial tanks," FGENexant's Ashraf said.
Around 50,000 tons of naphtha per month is being re-exported from the Karimun storage terminal, while some Ust-Luga cargoes are being re-shipped from Brazil, according to FGENexant.
VENEZUELA
Venezuela has also stopped importing Russian naphtha as a diluent for its crude, with some tankers making U-turns after U.S. President Donald Trump imposed a blockade of all sanctioned tankers bound for Venezuela in mid-December.
Russia supplied an average 100,000 tons per month of naphtha to Venezuela between June and December last year, traders said.
To plug the supply gap, the U.S. will reinstate its naphtha flows to the Latin American country.
"U.S. naphtha did show some strength as flows to Venezuela resumed ... but U.S. supply alone is not going to be enough for Venezuela," said NextBarrel analyst Matias Togni.
(Reporting by Mohi Narayan in New Delhi, Natalia Chumakova in Moscow. Additional reporting by Shariq Khan in New York and Marianna Parraga in Houston. Editing by Florence Tan and Mark Potter)
Naphtha exports refer to the international trade of naphtha, a flammable liquid hydrocarbon mixture used primarily as a feedstock in petrochemical production and as a fuel.
Sanctions are restrictive measures imposed by countries or international organizations to influence or penalize a nation, often affecting trade, finance, and economic activities.
Re-exporting is the process of exporting goods that were previously imported, often to a different country, sometimes with modifications or without.
Heavy full-range naphtha is a type of naphtha that is processed into aromatics for gasoline blending or petrochemical production, typically having a higher boiling point.
The Tuapse refinery is a significant oil processing facility in Russia, known for producing various petroleum products, including naphtha.
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