Brazil: imports of Russian diesel fuel increased by 6000%

Last year, diesel imports from Russia grew by 4,600% in Brazil, and fuel oil purchases increased by almost 400%, boosting the Russian economy by $8.6 billion.

According to official government data cited Financial Times, Brazil imported 6.1 million tons of diesel fuel from Russia in 2023, up 6,000% from 101,000 tons the previous year. The dollar value increased 4,600% from $95 million to $4.5 billion. The Latin American country also increased its purchases of fuel oil from Russia, with imports rising to $5.3 billion last year from $1.1 billion a year earlier.

Brazil overtook Turkey to become the largest buyer of Russian diesel in October, according to Kpler, and rising diesel imports last year mean Russia has overtaken the US as Brazil’s largest fuel supplier. Government officials say a surge in purchasing that came in the first year of leftist President Luiz Inacio Lula da Silva’s first term has helped curb rising consumer prices.

Game with prices
Responding to a question about the sharp increase in imports of Russian diesel fuel, the Brazilian Ministry of Development, Industry and Foreign Trade said that foreign trade “many factors influence” “Fuel imports are the result of decisions made by private agents and follow the logic of supply and demand.”

Moscow is selling oil and petroleum products at reduced prices due to sanctions imposed by Western countries in retaliation for the invasion of Ukraine. Purchases from Brazil are permitted under the sanctions regime, provided it complies with a detailed set of rules on issues such as transportation. Oliver Stuenkel, professor of international relations at the Getúlio Vargas Foundation, said: “Brazil has found an opportunity to purchase Russian goods at a discount, and we are talking not only about diesel fuel, but also about fertilizers. The same can be said about countries like India.”

“[Но] at the same time, Brazil wants to maintain its economic and political ties with Russia. The fact that Brazil is ready to help in the midst of this situation [в Украине]is part of the implicit dynamic within the BRICS that they maintain an all-weather friendship and help each other in difficult times,” – he stressed, referring to the group, which also includes Russia, India, China and South Africa.

Last year, the Minister of Mines and Energy said that the Ministry “works tirelessly to ensure fuel supplies… for the country.”

Although Brasilia has officially condemned the Russian invasion, Lula has repeatedly said in the past year that Kyiv bears as much responsibility for the conflict as Moscow and accused Washington of “encouraging” the violence.

Increase in percentage
In December, Russia accounted for 85% of all Brazilian diesel imports. Brazil relies on diesel imports to meet about 20% of domestic demand. Under Lula, state oil company Petrobras is investing in increasing refinery capacity.

Felipe Perez, director for the Americas at S&P Global Commodity Insights, said that despite “some politics,” price is the main factor driving diesel imports.

“People will try to find cheaper diesel fuel. In Brazil, everything depends on diesel fuel. Not only transport, but also the agricultural sector,” – he emphasized.

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