Report: Russia Starts Sending Fuel to Iran by Rail

Russia has started fuel exports to Iran by rail, Reuters reported on April 11, as the two countries are forging closer ties in order to support their economies and to undermine Western sanctions.

The Russian government announced the start of swap supplies of oil products with Iran last autumn, but shipments via Kazakhstan and Turkmenistan only began this year, the news agency quoted three sources as saying.

Russia supplied up to 30,000 tonnes of gasoline and diesel to Iran in February and March, two sources familiar with the export data said.

Another source confirmed the trade but was not able to confirm the volumes supplied. 

One of the sources said that Iran sent some gasoline cargoes to Iraq and other neighboring countries by truck.

Reuters said the Iranian and Russian Oil Ministries did not reply to requests for comment.

Previously, Russia had supplied small volumes of fuel to Iran by tanker through the Caspian Sea, according to two traders.

Iran’s stagnating infrastructure and inability to sell freely to world markets has left it struggling to meet its energy needs and its few remaining international customers.

Sanctions on Russian oil products over the war in Ukraine have reshaped global fuel markets, with traditional buyers shuning trade with Moscow. 

Russian oil companies are interested in exporting diesel and gasoline to Iran by rail as exports by sea face high freight rates and a price cap imposed by the Group of Seven (G7) leading industrialized nations.

However, the exports by rail face bottlenecks along the route, the sources told Reuters.

"We expect fuel supplies to Iran to rise this year, but we already see several issues with logistics due to rail congestion. That may keep exports from booming," one source said.