An oil superpower that can’t fill its own gasoline tanks: How Ukraine’s drone war upended Russia’s fuel market
Shortages of gasoline and diesel have affected most of Russia’s regions, as well as the annexed areas of Ukraine, to one degree or another. Regional restrictions usually take the form of bans on filling canisters and limits on how much any one customer can buy. At some gas stations, there’s no gasol
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Russia is in the acute phase of a fuel crisis
Shortages of gasoline and diesel have affected most of Russia’s regions, as well as the annexed areas of Ukraine, to one degree or another. Regional restrictions usually take the form of bans on filling canisters and limits on how much any one customer can buy. At some gas stations, there’s no gasoline or diesel at all; at others, lines stretch for miles, and drivers spend hours — sometimes dozens of hours — waiting.
The occasional easing of these restrictions clearly doesn’t yet look like a reversal of a trend that threatens to engulf the entire Russian economy in crisis.
Is it really that bad?
Looks like it.
Ukrainian drones struck the Omsk refinery on July 6, hitting the last of Russia’s major oil-processing plants that had not yet been targeted. As in many other cases, the full scale of the damage and the plant’s prospects for recovery aren’t entirely clear. But Ukrainian OSINT sources claim the strike damaged the plant’s primary crude-processing unit (the AVT-11) — a key link in any refinery’s infrastructure. Reuters sources also confirmed that the plant had halted operations.
Overall, Russia’s refining volume fell 25 percent in June from the same period in 2025, to 3.91 million barrels per day, Gary Peach, an analyst at the consulting firm Energy Intelligence, told the Associated Press. By his calculations, the industry has fallen to its lowest level in more than 20 years, and the disruptions are “unprecedented.”
Gasoline production, according to Energy Intelligence, dropped 17 percent year-over-year last month, to 850,000 barrels per day — well below what the domestic market needs. The shortage also shows up in trading data. According to the National Exchange Price Agency, gasoline sales on the St. Petersburg exchange fell 23.9 percent year-over-year in June, to 610,360 tons. Diesel sales collapsed even harder — down 35.4 percent, to 1.07 million tons. As of July 1, the agency put unmet demand on the exchange at 62,040 tons of AI-92 gasoline and 38,520 tons of AI-95.
Kpler, another respected analytics firm, takes a slightly rosier view of Russia’s June refining: 4.1 million barrels per day. It even expects the figure to climb 7–22 percent between July and September (to 4.4–5 million barrels per day), though even then, fuel production would remain below previous years’ levels. An industry source quoted by the newspaper Kommersant was skeptical of that forecast: in July, at least, he believes refining will “at best” hold at 4 million barrels per day — barring new unplanned refinery shutdowns.
Do Russians have any reason to think more refineries won’t be shut down?
So far, Ukrainian attacks show no signs of letting up — hundreds of drones strike Russia almost daily. And Volodymyr Zelensky has warned the Kremlin that the number will eventually climb into the thousands of drones. How realistic those plans are is hard to judge, but the intensity of the raids clearly won’t subside anytime soon.
What’s more, the target list will quite likely keep expanding. Refineries aren’t the only targets: on July 6, Ukraine attacked the Vysotsk oil terminal in the Leningrad region and fuel tankers in the Sea of Azov. Strikes on different parts of the industry’s interconnected infrastructure only compound the crisis’s overall effect.
Where’s the fuel crisis showing its earliest repercussions?
In agriculture, for one.
Russian farmers are already bringing in this year’s harvest one to two weeks behind the 2025 schedule, Dmitry Rylko, director general of the Institute for Agricultural Market Studies, told Kommersant. As of July 1, only a third as much acreage had been harvested as a year earlier.
Meanwhile, fuel deliveries for farm equipment keep running late, and fuel costs have risen by a third — making it a struggle to haul grain from the fields.
The shortage is hitting other logistics-dependent industries, too. Wildberries, Russia’s largest online marketplace, cited rising fuel prices as the reason for raising its seller commissions starting July 7. And retailers have asked the government for priority rights to fuel the trucks that deliver food to stores, warning that the country otherwise risks disruptions to its food supply.
What do the authorities plan to do about it?
They’ve already allowed refineries to release lower-grade Euro-3 fuel onto the domestic market, and they may drop the quality bar further still, to Euro-2. That means extra supply at gas stations to ease the shortage — but car owners will face a higher risk of breakdowns, especially in newer models. And this kind of gasoline and diesel, with its elevated levels of sulfur and other harmful substances, can damage the environment and public health.
A less controversial measure that could help the market is importing fuel. The talks center primarily on supplies from Belarus and Kazakhstan.
In June, Russia imported a record volume of gasoline from Belarus: 141,000 tons. That’s 2.4 times more than in May — and almost 141 (!) times more than in the same period of 2025. Even so, Belarusian supplies are unlikely to exceed 150,000–170,000 tons a month, while Russia’s summer gasoline consumption is estimated at no less than 110,000 tons per day.
Kazakhstan’s help will probably be even more modest. The country is prepared to send Russia just 50,000 tons of gasoline in July and August, Reuters reported. Kazakh exporters are wary of expanding cooperation with Russian companies partly because of the risk of secondary sanctions, the agency noted.
Fuel can also arrive by sea from India. Reuters has reported that the first shipments — 60,000 tons — have already been purchased and will soon be delivered to a Russian port. In India, Russia has one relatively reliable supplier: the Nayara Energy refinery, 49 percent of which belongs to Rosneft. But even Nayara’s capacity won’t be enough to make up for everything Russia’s oil industry has lost.
Will gasoline and diesel prices skyrocket?
For now, the authorities appear determined to hold down fuel inflation with the tools they have. Chief among them is the so-called damper mechanism: subsidizing domestic prices by covering major oil companies’ lost profits. (That’s why gasoline and diesel cost more at independent chains — those stations have to buy fuel at high exchange prices.)
On one hand, this keeps the public from panicking over sky-high prices at the pump. On the other, it blocks the market from regulating itself and only deepens local shortages, provoking those same hours-long lines and clashes between exhausted drivers. The damper also drains budget revenues, costing the treasury hundreds of billions of rubles a month.
Should Russians expect prices to hold steady?
No — they’re rising anyway, despite all the authorities’ efforts. At the end of June, inflation accelerated to 6 percent year-over-year, and the Central Bank identifies rising fuel prices as one of the key drivers of the overall trend. Although the regulator’s head, Elvira Nabiullina, insists that the Bank of Russia doesn’t yet consider costlier gasoline a factor in sustained inflation, it’s impossible to rule out that the situation will get worse.
The crisis has been intensifying for several weeks now; the strike on the Omsk refinery and other key facilities suggests the shortages will likely spread further, while the authorities have yet to produce a single tool capable of doing more than putting out local fires — let alone mounting a long-term, full-scale response to the Ukrainian drone raids.
All Russians can do is watch anxiously to see how deep the Ukrainian military’s arsenals run — and whether the country is headed for a crisis across the entire economy, with runaway prices and the collapse of logistics, agriculture, and other fuel-dependent industries.
