Russia Faces Potential Fuel Crisis as Ukrainian Strikes Disrupt Refining capacity
Moscow – Russia is grappling with potential fuel shortages and rising prices following a series of Ukrainian drone strikes targeting its energy infrastructure, coupled with government restrictions on fuel exports. Daily production was down 11% compared to January as a direct result of the attacks.
The situation marks a rare and tangible impact of the war in Ukraine on the Russian population, with consumers already experiencing meaningful price increases. Unleaded 92 petrol prices in western Russia have risen by 42% since the start of the year, according to the St. Petersburg Stock Exchange. The crisis is especially acute for self-reliant gas stations, with a 2.6% nationwide decline as the end of July, escalating to 14% in the south and a dramatic 50% in the illegally occupied crimean region.
Ukrainian strikes have hit 16 of Russia’s 38 refineries, impacting up to 38% of the country’s refining capacity as of September 28. In response, the Kremlin has implemented a series of measures to mitigate the shortages, including increased petrol and diesel purchases from Belarusian refiners – up 36% over the last three months, totaling almost 100,000 tonnes – and the suspension of customs tariffs on petroleum product imports into the Eurasian Economic Union (EAEU) countries until July 2026.
Moscow is also considering abolishing 5% import duties on petrol from China,south Korea,and Singapore. Furthermore, the government is proposing a temporary re-authorization of monomethylaniline (MMA) – an octane-boosting additive banned since 2016 - in petrol production, and exploring economic incentives for ethanol in gasoline.
Russia has previously experienced oil crises in 2021, 2018, and 2011, but the current situation is compounded by export restrictions. Moscow has decreed new prohibitions on exports of diesel, marine fuel oil, and other diesels, effective until December 31. The advancement of Kyiv’s ability to conduct in-depth strikes on Russian territory suggests this crisis could persist.
