Speaking at the meeting of oil industry top managers and government officials in the city of Samara on the Volga river, Putin also said Russia would eventually switch to profit-based taxation.
Oil firms have been lobbying for such a move, and it also received the support of the Finance Ministry's top tax official last week. But he also suggested that the refining incentive could be eliminated.
Putin proposed to introduce punitive measures for producers of low-grade oil products to strip them of access to pipelines, voicing his concern over so-called 'samovars', which are small-scale refineries.
Many of these often unlicensed refineries distil crude and export straight-run products such as fuel oil, taking advantage of a lower export duty on heavy products.
"On the whole, we have about 250 so-called 'samovars', which you can't even conditionally call refineries ... They don't produce for the end-user but make interim products for export," he said.
Putin said the government would continue to encourage oil companies to produce more refined fuel in an effort to squeeze value out of its hydrocarbon wealth and that it would equalise the duties on exports of heavy and light oil products.
