Bloomberg: For the first time, Russia’s fuel output in doubt as Ukrainian drones hit three key refineries

Ukrainian drones have recently struck oil refineries operated by major producers Lukoil and Rosneft, raising concerns over Russia’s ability to sustain fuel production.
Ukrainian drone strikes Russia Engels Saratov
A blaze above the Kristall fuel storage facility at the Engels-2 airbase. Photo: Russian TG channels via Yigal Levin
Bloomberg: For the first time, Russia’s fuel output in doubt as Ukrainian drones hit three key refineries

Recent Ukrainian drone attacks on Russian oil refineries are raising concerns about Russia’s ability to maintain its fuel production capacity, Bloomberg reports.

The attacks, which have intensified over the past eight days, targeted three major refineries in central and southern Russia, including facilities operated by industry giants Lukoil PJSC and Rosneft PJSC.

The most recent strike occurred on 31 January at Lukoil’s Volgograd refinery, following attacks on the Ryazan and Nizhny Novgorod facilities. The Ryazan refinery, located approximately 120 miles southeast of Moscow, has reportedly halted operations, though the impact of the Volgograd attack remains unclear.

Despite these disruptions, industry experts suggest the situation remains manageable for now.

“A stoppage of a few refineries for a few weeks is something that the Russian oil industry and economy can easily sustain,” says Sergey Vakulenko, a former Russian oil executive now with the Carnegie Endowment for International Peace.

Viktor Katona, lead crude analyst at Kpler, estimates that Russian crude processing rates may have dropped to between 5.2 and 5.3 million barrels per day, levels typically seen during seasonal maintenance periods. However, the country appears capable of compensating for production losses by increasing output at other facilities.

The attacks come as Ukraine intensifies its campaign against Russian infrastructure, targeting not only energy facilities but also ammunition production plants. Ukrainian officials state that their primary objective is to disrupt supplies to the Russian military and reduce the Kremlin’s ability to produce and export oil and fuel, which remains crucial to Russia’s budget.

The situation is further complicated by recent US sanctions imposed on 10 January, described as the toughest measures yet against Russian oil and gas interests. The sanctions target major players, including Gazprom Neft PJSC and Surgutneftegas PJSC, and much of the shadow fleet transporting Russian oil internationally.

However, Russia has maintained its position as one of the world’s leading oil and fuel exporters, successfully redirecting exports to markets in India, China, and Türkiye following Western sanctions that closed off European and North American markets.

Russian authorities and companies have largely remained silent about the impact of these drone strikes on their industrial facilities and economy, with production and export data classified since 2022, making it difficult to assess the full extent of the damage caused by Ukraine’s attacks.

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