In May, Ukraine launched a record number of drone attacks, at least 16, on Russian oil facilities, intensifying a campaign that has significantly damaged Russia's refining capacity. These strikes hit eight of Russia's 10 largest oil refineries, leading to the lowest oil refining output since October 2009, with production down approximately 13% from a year earlier. This drop in output is creating the risk of domestic fuel shortages and price spikes just as summer demand for fuel increases in Russia.
The decreased refining output is pressuring the Russian government to prevent a widespread fuel crisis, as higher fuel prices have previously triggered protests and contributed to inflation. To safeguard domestic supplies, authorities have banned exports of aviation fuel until the end of November, in addition to an existing prohibition on most gasoline sales to foreign markets. Despite these measures, daily volumes of premium 95 gasoline offered for delivery in European Russia fell to about 5,000 tons per day by the end of May, one-third of the supply a year ago, with exchange prices for this fuel rising over 20% year-on-year.
The strategic shift by Ukraine to target specialized secondary processing units like hydrocrackers, which are harder to replace, further exacerbates the situation. Repeated attacks on the same facilities are prolonging outages and hindering quick recovery of refining capacity. Although the Kremlin initially downplayed the impact, claiming production decreases were due to seasonal maintenance and that overall supply and demand were balanced, the cumulative effect of the strikes reflects a growing strain on Russia's energy infrastructure.
While average gasoline prices have seen a muted increase of just over 2 rubles ($0.03) to 67.53 rubles per liter according to federal statistics, the broader impact includes reports of restrictions on fuel sales in 14 Russian regions, extending from Moscow to Kamchatka, and panic buying in some areas, including occupied Crimea. Energy Intelligence analysts estimate that almost a third of Russia's refinery capacity, amounting to 2.14 million barrels per day, is currently idle due to these attacks.
