Attacks on refineries
Ukrainian drones cost Russia 600,000 barrels of oil per day
March 19, 2024, 4:30 p.m
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Russia’s economy is resilient despite sanctions. However, one particular tactic used by Ukraine is causing problems for the huge country: drone attacks on oil refineries. They leave lasting damage. According to an analysis, Russia is losing hundreds of thousands of barrels of refined oil every day.
Ukrainian drone attacks on Russian oil refineries in recent weeks have cost the Russian economy around 600,000 barrels of refined oil per day. This was reported by Torbjorn Tornquist, head of the Gunvor Group, an international commodities trading company, in an interview with Bloomberg on Monday. Gunvor Group was a major trader of Russian petroleum before Russia’s invasion of Ukraine, but withdrew from trading in spring 2022.
Over the last two weeks, Ukraine has deliberately attacked the Russian oil industry with drones. Attacks on at least eight refineries or tank farms have been documented by the beginning of the week. One source reports to Ukrainska Pravda that there are twelve systems. One or more kamikaze drones struck there, sometimes causing considerable damage. Most of the time, large-scale fires broke out, which required fire departments for hours. Not only locations close to the border were attacked, but also facilities that were sometimes hundreds of kilometers away.
According to Bloomberg, diesel futures rose four times in a row, while gasoline futures rose six times in a row. “This is significant because of course it will immediately hit distillate exports,” Tornqvist told Bloomberg. This will reduce exports by a few hundred thousand barrels, Tornqvist continued.
JPMorgan Chase & Co goes even further in its estimates. It suspects that the attacks and resulting outages could shrink Russian oil refinery capacity by 900,000 barrels per day, according to Bloomberg.
The Kremlin’s considerations made it clear that the attacks could actually have left lasting damage. Reuters reported that a spokesman for the Russian Energy Ministry was planning to better protect the country’s energy infrastructure using missile systems. In an interview with ntv.de, Colonel Markus Reisner explains that 10 to 15 percent of Russia’s refining potential could have been hit. One consequence can be seen in the rationing of fuel that has already been imposed in Russia. If the Kremlin actually places missile defense systems near refineries, these could again be missing from the front, said Reisner. This could give Ukraine an advantage if it were to receive F-16 fighter jets soon and use them against Russian positions.