Ukraine’s Shifting Strikes Deepen Uncertainty Around Russian Oil

Skip to Content News Archives Economy Energy Oil & Gas Renewables Electric Vehicles Mining Commodities Agriculture Real Estate Mortgages Mortgage Rates Finance Banking Insurance Fintech Cryptocurrency Work Wealth Smart Money Wealth Management Investor Personal Finance Family Finance Retirement Taxes High Net Worth FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials More Innovation Information Technology FP500 Podcasts Small Business Lives Told Tails Told Shopping Financial Post Store Obituaries Place a Notice Advertising Advertising With Us Advertising Solutions Postmedia Ad Manager Sponsorship Requests Classifieds Place a Classifieds ad Working Profile Settings My Subscriptions Saved Articles My Offers Newsletters Customer Service FAQ News Economy Energy Mining Real Estate Finance Work Wealth Investor FP Comment Executive Women Puzzmo Newsletters Financial Times Business Essentials This advertisement has not loaded yet, but your article continues below.HomePMN BusinessUkraine's Shifting Strikes Deepen Uncertainty Around Russian OilUkraine kept up its unrelenting pace of attacks across Russia’s oil supply chain in July, increasing the risk of disruptions at a time when global energy markets are already under pressure.Author of the article: You can save this article by registering for free here. Or sign-in if you have an account.n25nkvl06]rjgs8{drwrm09c_media_dl_1.png Bloomberg calculations based on(Bloomberg) — Ukraine kept up its unrelenting pace of attacks across Russia’s oil supply chain in July, increasing the risk of disruptions at a time when global energy markets are already under pressure.THIS CONTENT IS RESERVED FOR SUBSCRIBERS ONLYSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman, and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.SUBSCRIBE TO UNLOCK MORE ARTICLESSubscribe now to read the latest news in your city and across Canada.Exclusive articles from Barbara Shecter, Joe O'Connor, Gabriel Friedman and others.Daily content from Financial Times, the world's leading global business publication.Unlimited online access to read articles from Financial Post, National Post and 15 news sites across Canada with one account.National Post ePaper, an electronic replica of the print edition to view on any device, share and comment on.Daily puzzles, including the New York Times Crossword.REGISTER / SIGN IN TO UNLOCK MORE ARTICLESCreate an account or sign in to continue with your reading experience.Access articles from across Canada with one account.Share your thoughts and join the conversation in the comments.Enjoy additional articles per month.Get email updates from your favourite authors.THIS ARTICLE IS FREE TO READ REGISTER TO UNLOCK.Create an account or sign in to continue with your reading experience.Access articles from across Canada with one accountShare your thoughts and join the conversation in the commentsEnjoy additional articles per monthGet email updates from your favourite authorsSign In or Create an AccountLarge Russian refineries and oil tankers, as well as sea and major pipeline infrastructure, were hit at least 30 times last month, according to data compiled by Bloomberg based on public statements from both countries. That’s the second highest monthly number of strikes since Russia’s full-scale invasion.As Ukraine broadens its campaign across Russia’s oil industry, repeated strikes are disrupting refining and logistics, threatening exports at a time when global refiners are already running at full tilt after the Iran war tightened supplies. Moscow last week extended a ban on most diesel and gasoline exports to prevent domestic shortages.Get the latest headlines, breaking news and columns.By signing up you consent to receive the above newsletter from Postmedia Network Inc.A welcome email is on its way. If you don't see it, please check your junk folder.The next issue of Top Stories will soon be in your inbox.We encountered an issue signing you up. Please try againJuly’s tally doesn’t include eight strikes on tankers linked to the Caspian Pipeline Consortium’s terminal on Russia’s Black Sea, as nobody has claimed responsibility for the incidents. If Kyiv claims the attacks, July would be a record month for strikes on Russia-linked oil assets.“The future of Russian refining and oil exports is dependent on the number of drones in Ukraine’s disposal and its decision to allocate these drones to particular targets,” said Sergey Vakulenko, a senior fellow at the Carnegie Russia Eurasia Center in Berlin and a former Russian oil executive. “Russia’s effort to boost air defense could reduce the number of drones reaching targets, but not shield them completely.”In the first half of July, Kyiv focused its attacks on oil refineries, including one in Omsk, which is Russia’s largest and located over 2,500 kilometers (about 1,600 miles) from Ukraine’s border. That forced producers to sell near-record amounts of crude abroad as their plants reduced processing rates to the lowest since May 2002. Ukraine’s focus in the second half of July was on tankers, offering respite to some refineries to repair and resume operations. EA Analytics estimates Russia’s crude-processing rates averaged 3.6 million barrels a day in July, higher than a previous estimate of 3.5 million barrels a day, but still about a third below the seasonal norm. Kyiv has resumed strikes on refineries more recently, hitting another three major facilities in the last three days of July and four others during the weekend.Ukraine is working “to increase the lethality” of Russia’s losses, while “degrading Moscow’s wartime economic capacity,” according to nation’s Commander-in-Chief Mykhailo Drapatyi. “To achieve this, we are employing asymmetric approaches and Ukrainian technologies,” he said on Telegram last week following a phone call with Alexus Grynkewich, NATO’s Supreme Allied Commander Europe.The approach was evident in Ukraine’s attacks in Russia’s Black Sea and the Sea of Azov, with strikes disrupting shipments from nation’s southern ports. In the week through July 26, only four tankers loaded at Novorossiysk — which handles about 20% of Russia’s seaborne crude exports — compared to seven and eight in the previous two weeks respectively, according to tanker-movements data compiled by Bloomberg.This advertisement has not loaded yet.This advertisement has not loaded yet, but your article continues below.That followed several strikes on large-size tankers, one of which was chartered to load crude from the CPC terminal, the main route for Kazakhstan’s oil exports, the Bloomberg tally shows. In total, Ukrainian military authorities claimed at least 125 attacks on Russian-linked ships, including 90 tankers in the Black Sea and the Sea of Azov.Bloomberg couldn’t independently verify the figures, which also included tiny ships carrying fuel to occupied Crimea. Following the intensified attacks, the Defense Ministry in Moscow warned vessels that Russia’s Black Sea was not safe for navigation, underscoring the risks to one of the country’s key oil export routes.“Russia has some ability to reroute its own crude” from Novorossiysk to its Baltic ports, said Jorge Leon, senior vice president and head of geopolitical analysis at Rystad Energy AS. However, “spare pipeline, storage, and tanker capacity is unlikely to be sufficient to absorb all displaced Black Sea volumes,” Leon said, adding that Baltic ports are also prone to disruptions, as attacks earlier this year showed.Notice for the Postmedia NetworkThis website uses cookies to personalize your content (including ads), and allows us to analyze our traffic. Read more about cookies here. By continuing to use our site, you agree to our Terms of Use and Privacy Policy.