Russia loses millions of tons of diesel as Ukrainian strikes hammer refineries, Reuters
Photo: A car being refueled with diesel (Getty Images)
Ukrainian strikes on Russian oil refineries are increasingly affecting Russia’s fuel sector. Diesel production has been declining for the second month in a row, reports Reuters.
In May, diesel fuel production in Russia decreased by approximately 10% compared to the previous month. A similar decline was recorded in April as well.
The main reason is said to be Ukrainian drone attacks on Russian oil refineries. Due to the damage, some enterprises were forced to reduce output or temporarily halt production.
Ukraine is systematically striking Russia’s energy infrastructure, seeking to reduce Moscow’s revenues from oil and oil product sales, which are used to finance the war against Ukraine.
According to Reuters estimates, in April, the plants affected by the attacks produced 1 million tons less diesel than usual. In May, losses amounted to approximately 600,000 tons.
For comparison, in March, diesel fuel production in Russia was estimated at 7.5 million tons.
Exports remain high
Despite the decline in production, Russia continues to maintain significant volumes of diesel fuel exports.
According to market sources and LSEG, seaborne exports of diesel and gasoil in April increased by 8% compared to March and reached about 3.25 million tons. In May, export shipments remained at approximately the same level.
Because of this, Russian authorities even considered temporarily restricting exports to ensure the domestic market is supplied with fuel during the active field work season.
At the same time, industry sources believe that the introduction of a ban is unlikely, as additional restrictions could further complicate the operation of oil refineries.
The decline in diesel production may limit Russia’s ability to take advantage of high oil prices, which have risen amid the conflict surrounding Iran and tensions in the Strait of Hormuz.
How Russia is earning from the war in the Middle East
Amid the conflict surrounding Iran and a spike in global oil prices, Russia has gained additional opportunities to increase oil revenues. The situation was also reinforced by a partial easing of US restrictions on Russian oil supplies.
In May, the United States extended a temporary license allowing the most vulnerable countries to purchase Russian oil that is already in transit by sea.
According to Vladyslav Vlasiuk, the Ukrainian presidential commissioner for sanctions policy, over just two months of such easing, Russia could have earned more than $5 billion in additional revenue.
Ukrainian President Volodymyr Zelenskyy stated that there are no grounds for easing sanctions against Russia, as this only contributes to the continuation of aggression.
