Ukrainian defense forces continue their strikes on Russia's oil and oil refining sector. Recently, fires broke out at an oil refinery in Sterlitamak, Bashkortostan, and at the LUKOIL oil depot in Kstovo, Nizhny Novgorod region. Such attacks by Ukraine symbolically align with US sanctions against Russian oil giants even before these sanctions take effect.
Strikes on Russia's oil and refining infrastructure have become routine, causing ongoing new problems for the Russian economy. At the same time, new sanctions are being imposed against Rosneft and Lukoil, further compounding the industry's challenges. Previously, Russian oil companies exported surplus crude to India, Turkey, and China, but now these countries are wary of US sanctions and are cutting back on imports. Adapting to new restrictions will take time for these "Global South" countries, and Russia must develop new pricing policies. Meanwhile, major plants in China, India, and Turkey are already refusing extra Russian oil purchases in the coming months.
This drop in crude purchases could force Russian firms to mothball wells, leading to a degradation of the entire industry in a scenario reminiscent of Venezuela. If attacks intensify and new sanctions emerge, Russia will have to find alternatives to its shrinking oil income. This could hasten the end of the Russian-Ukrainian war and result in a global transformation of Russia's energy sector, similar to what happened with its gas industry.
Each new fire at a Russian oil refinery or strike on an oil depot brings Russia's economy closer to degradation and objectively hinders its aggressive policies. Ukraine and neighboring states gain a period of greater security. Russia's oil and refining sector risks losing its global position permanently.
