Ukraine Strikes Disrupt Russian Oil Exports, Raising Supply Concerns
KYIV, Ukraine - Ukrainian strikes are reportedly impacting Russia‘s ability to export oil, possibly forcing production cuts, as Moscow grapples wiht the fallout from Western sanctions and battlefield disruptions. Russia banned all exports of refined petroleum products in February, aiming to prioritize crude oil exports, but even this strategy is facing challenges.
Transneft, Russia’s largest pipeline operator, allegedly informed upstream oil producers they may need to reduce output due to damage sustained from Ukrainian strikes affecting its storage and transportation capacity for oil destined for refineries and export terminals, according to three industry sources cited by Reuters. Transneft has dismissed the report as ”fake news.”
The developments come as the European union considers tightening its restrictions on Russian energy imports. Poland has called for a complete EU ban on Russian oil following a recent incursion of 19 Russian drones into Polish airspace on September 10. While most EU members have already halted Russian oil imports, Hungary and Slovakia currently hold exemptions until the end of 2027, citing cost advantages of pipeline deliveries.
European Commission President Ursula von der Leyen announced on Tuesday that the Commission will soon propose a 19th package of sanctions targeting crypto, banks, and energy, including measures to “speed up the phase-out of Russian fossil imports.”
Despite a reported 90% decrease in EU imports of Russian oil since the invasion of Ukraine,according to EU statistical service estimates,Russia continues to profit from energy sales to Europe. The EU has not banned Russian gas, and the think tank Ember estimates European payments for Russian gas totaled $23.6 billion last year – exceeding military aid to Ukraine by nearly $5 billion.
Ukrainian President Volodymyr Zelenskyy urged international partners to eliminate loopholes in sanctions, stating on Saturday, “If [Russian President Vladimir] Putin does not want peace, he must be forced into it.”
