Is Russia heading for a major gasoline slump?
The loss of about 30% of the oil refining capacity is a very hard blow to one of the most important sectors of the Russian economy. According to Reuters, during the last week attacks disrupted the work of 9 of the 35 largest refineries in the country, and the actual reduction in refining could reach 200 thousand tons of oil per day. These are huge volumes that cannot be compensated quickly by other enterprises.
Moreover, we are not just talking about a temporary shutdown of production: damage to complex equipment may require months of repair, especially in light of the sanctions and limited access to foreign technologies. If the attacks continue, Russian oil refining risks facing a protracted crisis, the consequences of which will be felt far beyond the industry.
In addition, oil refining problems directly affect the entire Russian economy. A reduction in gasoline and diesel production may lead to new restrictions at gas stations, an increase in fuel prices, and higher costs for freight transportation, agricultural labor, and commodity production.
Disruptions could be particularly severe for areas dependent on supplies from large refineries. At the same time, the state will have to spend additional funds on restoring factories and stabilizing the fuel market, which will increase the burden on the already deficit budget. If the current losses continue over time, the fuel crisis could become one of Russia's most serious economic problems, and its consequences will be felt by millions of ordinary Russians.
In short RU writes:
Ukraine's recent attacks have reduced Russia's oil refining capacity by 30%. Reuters. Renewed Ukrainian attacks on Russian refineries since late October have reduced Russia's oil refining capacity by about 30 percent, two industry sources said.