Ukrainian Drone Attacks Cause Record Gasoline Prices, Shortages in Russia

Russia is currently grappling with record-high gasoline prices due to a surge in Ukrainian drone attacks on key oil refineries, despite the Russian government’s efforts to restrict petrol exports.

Ukraine has been focusing its drone assaults on refineries, pumping stations, and fuel trains as part of an attempt to impede the Russian war machine and disrupt daily life within Russia. The peak summer demand for gasoline among Russian drivers and farmers further exacerbates this issue.

Ukrainian drones have reportedly struck at least ten significant Russian energy facilities this month alone, according to CNN’s tally of attacks. These refineries account for more than 44 million tons of products annually, representing over 10% of Russia’s total capacity, as per Ukraine’s intelligence service.

High-profile targets include the Lukoil refinery in Volgograd, the largest in southern Russia, and a refinery in Saratov, both of which have been affected by these attacks. In addition, fires continue to burn at another refinery in the Rostov region more than two days after it was hit, according to Ukraine’s Commander of Unmanned Systems, Robert Brovdi.

Gasoline shortages are being reported across multiple Russian regions and annexed Crimea. Russia’s governor of Crimea, Sergey Aksyonov, attributes these shortages to logistical challenges, with the government taking measures to procure necessary fuel volumes and stabilize prices.

A pro-Ukrainian activist in Crimea noted that the most popular grade of petrol is no longer available, and attributed this scarcity to the successful drone attacks on Russia’s economy.

Despite government subsidies, Russian consumers are experiencing increased fuel costs at the pump. Wholesale petrol prices on the St Petersburg exchange have risen by nearly 10% this month and over 50% since the beginning of the year. This escalation is primarily being passed on to consumers, particularly in the Russian far east, where analysts predict no immediate relief.

The Russian government’s ban on petrol exports, implemented in late July, has led to an increase in crude oil exports instead, albeit temporarily easing the gasoline shortage situation.

The military is less affected due to its high demand for diesel, which faces fewer supply disruptions. However, Ukrainian forces have been developing long-range warfare tactics using drones, missiles, and sabotage, in addition to traditional ground combat operations.

In the past few months, there has been visible damage inflicted on refineries, storage tanks, and pumping stations within Russia. This destruction is complicated by European and US sanctions against Russia, making repairs more challenging.

Ukraine’s foreign intelligence service reported that Russian companies are increasingly purchasing petroleum from Belarus to address domestic shortages. In the past week, interest in Belarussian oil products on the Russian market has surged, as per state-owned refiner Belneftekhim.

Ukraine is also attempting to obstruct Russian oil exports, having struck the Druzhba pipeline that supplies Russian oil to Hungary and Slovakia—two EU countries maintaining positive relations with Moscow. Both countries lodged complaints with the EU, stating that Ukraine’s attacks are primarily harming Hungary and Slovakia rather than Russia.

US President Donald Trump expressed his displeasure over the disruption in a hand-written note to Hungarian Prime Minister Viktor Orban. However, for Ukraine, under intense pressure on the frontlines, these attacks on Russia’s vital energy industry serve as a means to counter Moscow’s assertions of an inevitable victory.

Ukraine recently unveiled a new domestically produced cruise missile called the Flamingo, with plans to produce 200 per month. Missile expert Fabian Hoffman suggests that this weapon could cause substantial damage to soft targets like distillation columns in Russian refineries due to its lethal radius of over 38 meters.

Mick Ryan, author of the blog Futura Doctrina, believes that while the Flamingo may not be a silver bullet, it will significantly enhance Ukraine’s capacity to harm Russia. This is partly because defending every oil refinery is a challenging task.

In the short term, analysts anticipate some disruptions in Russian gas stations but do not expect mass fuel scarcity. However, they predict an extension of the ban on gasoline exports into the autumn as the Kremlin attempts to control prices and ensure supply.