Two-Thirds of Russian Regions Face Fuel Crisis After Ukrainian Strikes

How Ukrainian Attacks Disrupted Russia's Energy Supply

According to Главком: Ukrainian strikes on Russian energy infrastructure have triggered a severe fuel shortage, turning the conflict into a full-blown crisis. Out of Russia's 83 regions, two-thirds now report disruptions in fuel supply. In occupied Crimea, authorities have declared a state of emergency and banned fuel sales. The Kremlin has classified the official damage assessments and domestic fuel prices, making it difficult to gauge the true extent of the problem.

India, the largest buyer of Russian crude oil, is now exporting some refined fuel back to Russia. Ukrainian attacks have specifically targeted catalytic cracking units, which Russia cannot repair due to sanctions. In response to the growing deficit, the Russian government has banned exports of gasoline and aviation fuel and is considering a similar ban on diesel.

Economic Fallout and Government Responses

Russia's Central Bank cut its key interest rate to 14.25% in June, signaling efforts to stabilize the economy. Earlier, amid economic challenges, Central Bank Governor Elvira Nabiullina had raised rates to 23%. Liquid assets from Russia's National Welfare Fund have shrunk from 7% of GDP in early 2022 to just 1.7% of GDP by April 2023.

On June 18, drones struck the Moscow Oil Refinery in the Kapotnya district. Ukrainian President Volodymyr Zelensky confirmed this was the second attack on the facility within a week. Experts note that 'Russia's gasoline supply is now a race between Ukrainian drones and Russian repair crews,' according to Sergey Vakulenko, an analyst at the Carnegie Endowment for International Peace.

“Russia’s air defense system is performing effectively,” said Kremlin spokesman Dmitry Peskov.

Despite the evident fuel supply issues, President Vladimir Putin has stated that 'the shortage is not critical.'

The fuel supply situation in Russia remains dire, threatening the country's economic stability. Reduced fuel volumes and export bans could deepen domestic economic hardships and fuel social tensions. As the crisis unfolds, the Kremlin's next moves will be crucial in shaping outcomes for both Russia and Ukraine.

The ongoing fuel crisis in Russia has been exacerbated by recent drone strikes, which have significantly impacted the country's oil refining capacity. As Ukrainian forces continue to target critical infrastructure, the situation is evolving rapidly. For a deeper understanding of how these attacks have disrupted a substantial portion of Russia's refining capabilities, read more about the effects of drone strikes on Russia's energy sector.