Fuel production in Russia has fallen to a historic low
According to official data from Rosstat, production of petroleum products and coke in Russia saw its sharpest decline since 2006. In June, production fell by 21.7% compared to the same period last year and by 12% compared to May, and for the first half of the year, the decline reached 7.7%.
The main cause of the crisis was a series of Ukrainian drone strikes on Russian oil refining infrastructure, which collectively affected up to 58% of the country’s total capacity. As of mid-July, between 20% and 27% of refining capacity remained idle, and refining volumes fell to their lowest level in the past 21 years.
The shortage in the domestic market—where June gasoline production covered only about 65% of demand—led to a significant spike in prices and fuel shortages at many gas stations. In just one week, from July 14 to 20, gasoline prices rose by 1.7% and diesel prices by 1.9%, bringing the total increase since the beginning of the year to 18.3% and 20.2%, respectively. To curb the fuel crisis, Russia was forced to begin importing gasoline and diesel, offering tax breaks on imported fuel. The Russian military also began to experience difficulties securing supplies, leading to the imposition of limits on refueling military equipment. Among the affected facilities were the Ryazan Oil Refinery, which completely suspended trading on the exchange after 15 attacks, as well as the Moscow and Omsk oil refineries.
Source: The Moscow Times.
For the first time in history, Russia plans to begin importing diesel fuel due to a sharp decline in domestic production and a shortage in the domestic market.
The Russian Red Cross has begun building up additional stockpiles of humanitarian aid for the temporarily occupied Crimea and Sevastopol following the declaration of a state of emergency on the peninsula.
On the temporarily occupied Crimean Peninsula, local residents report prolonged power outages, fuel shortages, rising prices, and problems with social infrastructure. According to them, the situation is particularly dire in the northern regions of the peninsula.
As a reminder, Ukraine has claimed to have struck 19 Russian tankers carrying fuel for Crimea.
