UPDATE 2-Russia ponders gasoline import ban to protect home market - sources

(Adds data on Russian retail fuel market, no comment from Belarus)

MOSCOW, April 7 (Reuters) - Russia is considering a six-month ban on gasoline imports to protect its market from a possible flood of cheap fuel, two government sources said on Tuesday, as measures to contain the coronavirus outbreak have destroyed demand and hammered prices.

The move is mainly aimed at preventing imports from neighbouring Belarus, where production of refined products is three times higher than its consumption. Russia imports gasoline from some other countries but in smaller volumes.

Industry sources said Russia may import 2,040 tonnes of gasoline from Belarus in April by rail.

The first government source told Reuters, speaking on condition of anonymity, the aim of a ban would be to get Russian fuel production “working normally”. The restrictive measures could last until October, he added.

According to Reuters data, gasoline sales at filling stations across Russia declined in early April by up to 60% from the year-earlier period.

Diesel sales, meanwhile, slumped by up to three quarters as Russian President Putin prolonged until April 30 a paid non-working period across Russia, stepping up measures to stem the spread of the coronavirus.

The restrictions compound an already difficult economic situation in Russia after a sharp fall in the price of oil, its main export, pushed the rouble to four-year lows.

Moscow’s consideration of new restrictions on fuel imports follows a tentative agreement with neighbouring Belarus on the resumption of Russian oil supplies, which had significantly declined from Jan. 1 because of a row over pricing.

Russian media outlet RBC said on Monday the government had decided to suspend imports of “cheap fuel,” citing government officials.

Fuel demand has fallen as the country has introduced a partial lockdown in some large cities, primarily Moscow, which is home to around 8% of country’s population.

At the same time, retail fuel prices in Russia have been stable, while prices in Europe have fallen as lockdowns to try to stop the spread of the new coronavirus prevent movement and fuel use.

Russia’s primary oil refining production is meanwhile expected to increase after May as the peak maintenance season ends.

Industry sources told Reuters that Russian refineries have started using rail wagons to store oil products because the storage tanks usually used are full following weak demand.

The Russian energy ministry has said it expects domestic oil product consumption to decline in the next two weeks by 40%.

The Russian energy ministry, contacted by Reuters, declined to comment on plans to curb fuel imports. Belarus’ state energy company Belneftekhim did not immediately responded to a request for comment. (Reporting by Vladimir Soldatkin and Olesya Astakhova; additional reporting by Natalia Chumakova, Gleb Gorodyankin and Gleb Stolyarov in Moscow and Andrey Makhvsky in Minsk; editing by Barbara Lewis, Kirsten Donovan)