Two fuel crises in Russia. Why gasoline shortages are spreading to new regions

The fuel crisis in Russia has reached Moscow. But if in central Russia it is most likely temporary, then in Crimea it can become permanent

What's happening?

According to the estimates of the project “7×7 - Horizontal Russia” at the beginning of June, restrictions on retail sales of fuel were introduced in at least 14 regions of Russia. Among them are Moscow and St. Petersburg with regions, several regions of central Russia (Ryazan, Oryol), the North-West (Pskov, Novgorod, Murmansk regions, Karelia), regions of Siberia, including the Krasnoyarsk Territory, regions bordering Ukraine (Kursk and Belgorod), as well as “new regions” and Crimea. Almost a third of Russia's population lives in regions where there are signs of fuel shortages.

The crisis became acute in just a month. Its forms and severity vary by region - from a ban on the supply of fuel in cans at individual independent gas stations, through restrictions on the supply of fuel per receipt at gas stations of large chains (Lukoil, Rosneft), to a coupon system and finally a complete ban on free sales in Crimea and Sevastopol.

The head of Crimea, Sergei Aksenov, wrote on May 4 that the sale of fuel for cash to private owners will stop “for several days,” there will be no new coupons, 20 liters of gasoline will be issued for old ones, and this will be monitored by officials on duty at each gas station. According to reviews from local residents, which can be read under the governor’s post, there has been practically no gasoline on sale for a week now; you can stand in line at a gas station for several hours without any guarantees. Speculators' prices reach 250 rubles per liter.

The retail price of fuel in Russia is strictly regulated, but in the last two weeks the rise in price is noticeable even in the macrostatistics of Rosstat. Diesel fuel prices in the week to June 1 increased by 0.8% after 0.5% a week earlier, and gasoline prices by 0.5% after 0.3%.

There have long been signs of shortages on the wholesale market. The supply of AI-95 at the St. Petersburg Commodity and Raw Materials Exchange at the beginning of June does not exceed 7 thousand tons per day, more than two times less than in March, and wholesale prices have increased by 6% since the beginning of May. Russia is forced to import more and more fuel from Belarus and ban the export of gasoline and even jet fuel .

What's the matter?

The fuel crisis in Russia is two-modal - mainly production within the pre-war borders and logistics in the temporarily occupied territories. But both of them were organized by Ukraine.

What's in Russia

According to Bloomberg estimates , in May Ukraine carried out drone strikes on eight of Russia's top 10 oil refineries, some of which - the Yaroslavl Oil Refinery and Lukoil plants in Nizhny Novgorod and Perm - were attacked again. The agency provides an estimate according to which the drop in oil refining in May was the strongest since the beginning of the war - by 13% or by 700 thousand bpd year-on-year. The estimate is realistic, says a fuel industry analyst who spoke to The Bell, although part of the decline could also be explained by the government pushing back scheduled maintenance until the spring to ensure plants are running at full capacity by the summer peak in demand.

Carnegie Endowment expert Sergei Vakulenko told the agency that Ukraine has recently changed tactics: attacks on vulnerable, but relatively easily repaired primary separation plants have been supplemented by attacks on secondary processing equipment, often imported and sanctioned. Another analyst from the fuel industry clarifies The Bell: this is not about a complete shift in priorities, but about a change in the logic of the attacks - the desire to disable the maximum total capacity. Thus, the destruction of the AVT-6 unit at the Kstovo Oil Refinery, which provided 53% of its capacity, automatically reduced the load on secondary processing - there is simply nothing for catalytic cracking to process. According to some estimates , at the peak of the shock in May, 28% of the country's gasoline production was out of action.

“We have a number of oil refineries undergoing unscheduled repairs. But we, naturally, are maximizing the load on the export infrastructure,” Deputy Prime Minister Alexander Novak, curator of the Russian fuel and energy complex, was forced to admit at SPIEF.

Oil exports from Russia in May, indeed, did not decline despite Ukrainian attacks on export terminals, and began to bring excess income to the Russian budget due to the Middle Eastern market. However, this rather indirectly confirms the decline in refining: in general, there is nowhere to store “extra” oil in Russia. If in mid-May there was still the impression that the networks of vertically integrated companies (VIOCs) would not have problems with gasoline, then the news about restrictions in the capital dispelled this illusion: along with the large independent ORTC network, they were introduced at Lukoil and Gazprom gas stations. True, the limits are still high - 100 liters per check - and should not affect the majority of private car owners.

According to an analyst from the fuel industry, full-fledged restrictions in retail networks among large vertically integrated oil companies were recorded only at Surgutneftegaz at some gas stations in the Leningrad region and St. Petersburg. The rest are limiting small-scale supply - this really hits independent gas stations, but does not mean a shortage in the networks of the companies themselves. Restrictions, where they exist, are largely explained by rush demand amid news of the attacks, and not by a real lack of fuel, The Bell’s source says.

What's in Crimea

There is a real physical shortage of fuel in Crimea, the DPR and the occupied parts of the Zaporozhye and Kherson regions, but its nature is different. It is directly related to the war and is caused both by the recent “unmanned” turn in favor of Ukraine and by the cumulative effects of recent years. The shortage here is really not production, but logistics, emphasizes an analyst from the fuel industry.

First of all, the point is the Ukrainian Armed Forces’ breakthrough in the use of medium-range drones. These include Ukrainian-made drones with direct control via Starlink, and US-made Hornet AI drones. They allow strikes to the entire depth of the land corridor to Crimea, 150 km, and selectively hunt fuel tankers on the R-280 Novorossiya highway.

Estimates of damage from attacks have to be collected from data from Russian military channels, especially since the Crimean authorities remind about criminal liability for photos of fuel tankers, but we are talking about a figure on the order of units of affected fuel tankers per day. A close estimate was given by OSINT researchers: from 150 to 200 attacks on trucks, including fuel tankers, in the occupied territories throughout May, with intensification in the last two weeks and the start of remote mining of the road. It is still impossible to assume that the route is under fire control, as the Ukrainian media do, but the trend is obvious. A number of resources reported that due to the increased risk, truck drivers are asking for a month’s salary for one trip to Crimea.

There are, one might say, no normal alternative routes for delivering fuel to the peninsula. Tankers will be attacked by the same drones, and Ukraine was able to knock out railway ferries on the line to Kerch during the war years. Currently, only car ferries operating in the Kerch Strait are focused on non-fuel cargo and with limited carrying capacity. The passage of heavy vehicles and tanks on the Crimean Bridge has been prohibited since the terrorist attack in 2022, as well as fuel tanks on the railway part of the bridge. And this is a justified measure: the lengthy repair of the bridge after a truck explosion on it was due to the weakening of the metal structures due to the fire.

Ukrainian President Vladimir Zelensky said that due to targeted strikes by the Ukrainian Armed Forces, “Russia is facing a clear shortage of fuel in the temporarily occupied territories and parts of central Russia, as well as serious damage to its logistics.”

What's next?

The authorities have mechanisms to mitigate the crisis in the main part of the country, says an analyst from the fuel industry with whom The Bell spoke: expanding supplies from Belarusian refineries (capable of covering about 5% of consumption), tax breaks for the production of AI-95 and redistribution of transport capacity. In Russia, there remains a surplus of gasoline capacity and reserves, and demand is uneven from month to month. The most likely scenario for mainland Russia, according to him, is not a physical shortage, but a rise in prices, as was the case last summer.

The situation is different with Crimea. Military correspondents covering the topic agree that the situation is serious and Russia has overslept a qualitative shift in Ukraine’s actions against its fuel and energy complex and logistics, which the Ukrainian Armed Forces have not the slightest reason to stop. Worse, a huge territory is starting to play against Russia’s side: the Ukrainian Armed Forces are purposefully punching through corridors with depleted air defense to the same Volgograd, Perm or Kirishi, reducing the defense to an objective one. On the plus side, in the fifth year of the war, the Russian authorities decided to allow businesses to defend the oil refineries themselves, and the Russian military-industrial complex produced prototypes of suitable weapons. But all this looks too late and too expensive.

There is no good solution to the fuel crisis in Crimea at all: it is significant that Crimeans are asking Aksenov to allow the import of more than 100 liters of fuel from the “mainland” per trip of a private car. Former speaker of Novorossiya Oleg Tsarev proposes building a fuel pipeline to Crimea - which, he admits, will immediately become the target of attacks. He considers it most realistic to cover both the Crimean Bridge and the entire land corridor with anti-drone nets. A systemic solution would be small air defense with mobile fire groups and interceptor drones, but in Russia this problem has not been solved either organizationally or technically.