Ukraine is taking out oil refineries inside Russia, cratering Moscow’s supplies and sending local prices soaring.
Ukraine is taking out oil refineries inside Russia, cratering Moscow’s supplies and sending local prices soaring.
A wave of Ukrainian drone strikes on oil refineries deep inside Russia has left the Kremlin racing to defend its own territory while still waging war on its neighbor. But the attacks have also achieved the unthinkable — leaving the world’s largest petrostate running low on petrol.
Diesel prices for Russian consumers have skyrocketed, rising almost 10 percent in the past week alone, according to the government’s figures. Petrol costs have also hit a six-month high, up more than 20 percent from the start of the year as supply tightens and more and more facilities are forced to suspend production.
Last Wednesday, two fuel storage facilities owned by Russian energy giant Rosneft, around 500 kilometers from the border with Ukraine, were severely damaged by drones as fuel went up in smoke. More than a dozen refineries across nine Russian regions have been similarly hit this year, with officials in Kyiv saying the industry is a legitimate war target.
“It’s like a mosquito — when you can’t find it, can’t kill it and it keeps coming back night after night, you’re going to be exhausted," Philip Ingram, a former British military intelligence officer and NATO planner, said. “It’s a very good way of taking the pressure off from the front lines."
War is logistics. If the Russian war machine can be starved of fuel and money, the machine will grind to a halt. It's just a question of, can Ukraine cause enough damage to Russia's oil infrastructure fast enough to survive the advantages Russia has in manpower and equipment?
Unfortunately, yes. There have been a lot of efforts to shift the energy mix in the EU away from Russian oil and natural gas. But, the effort has been slow and has meant rising costs. Also, by removing Russian production from the supply side, prices will invariably increase. Ukraine does have to balance the damage that can do to foreign support, against their war aims. Personally, I think it's pretty selfish of the EU and US to ask Ukraine not to strike those resources. It's essentially the US/EU saying, "more of your people need to die, so we can save money." It's a really crappy thing to ask.
I've been hearing this exact thing for the past 2 years and frankly I can't say anything's fundamentally changed here, with the exception of a food prices increase that's more in line with the rest of the world than anything.
Y'all are on copium. Maybe of a lower grade than whatever Sergei "Another sanctions package will surely break Russia's economy, fr this time" Guriev and his army of pocket statesmen use, but still some hard hitting stuff.
Linked ITAR-TASS source says that the rise in that week was just 0.05 roubles per liter with the price around 55 roubles. Not sure where the 10% figure comes from, either some other source was used, or it was not translated correctly (mistook "5 копеек" (.05 rub) for 5 roubles)
The Russian government has blocked exports. This mean that there is also great opportunity cost. Because if the price abroad would be better the taxes missed cost the Russian government.