Ukrainian Drone Assaults Drive Russian Fuel Exports to Historic Lows

Ongoing drone strikes by Ukraine targeting Russia’s energy infrastructure have caused the country’s fuel exports to plummet to their lowest levels since the onset of the Ukraine invasion, as reported by Bloomberg on Wednesday.

In the initial ten days of October, average daily exports decreased to 1.88 million barrels, marking the lowest point since at least early 2022, based on data from Vortexa that Bloomberg analyzed.

Russia’s overall refining capacity remains below 5 million barrels per day, the lowest since spring 2022, following attacks on over 20 significant refineries.

Additionally, seasonal maintenance has exerted more downward pressure on production.

To address domestic shortages linked to the decline in refining capacity, the government has imposed a ban on gasoline exports.

A September attack also impacted the Ust-Luga terminal, responsible for approximately 60% of Russia’s naphtha exports, essential for petrochemical manufacturing. Consequently, naphtha shipments experienced a significant 43% drop month-over-month, falling to only 198,000 barrels per day in October, the lowest level since January 2022.

While diesel and gasoil exports increased by 13% from September, fuel oil exports decreased by 8%, according to Bloomberg.

This week, the International Energy Agency (IEA) cautioned that Russian oil companies will likely continue to experience the repercussions of Ukrainian assaults for nearly a year, revealing that one in three refineries has been targeted since August.

According to a report released on Tuesday, the IEA indicated that refining activities are not expected to return to normal levels until at least June 2026.

This prediction does not factor in potential future damages if Ukrainian drone strikes persist. Currently, refining throughput is estimated to have dropped by around 10% since the onset of these strikes.

Naphtha exports may face additional challenges from Taiwan, which is one of Russia’s largest buyers alongside India.

In the first half of this year, Taiwan’s imports of Russian naphtha surged sixfold compared to 2022, totaling 1.9 million tons valued at $1.3 billion, according to estimates by the Center for Research on Energy and Clean Air.

However, the Taiwanese economy minister recently stated that local companies would stop purchasing Russian naphtha if requested by the European Union.