Russia’s oil refining capacity has decreased by 14.5% this month due to Ukrainian drone attacks and technical outages.
The decrease in refining capacity could lead to higher crude oil exports as Russia lacks sufficient storage space.
Russia has extended its ban on gasoline exports until the end of 2024 to maintain domestic supply stability.
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Reuters calculations showed on Friday that the share of Russia’s refining capacity that is offline this month has jumped from August to 14.5% of all processing capacity amid Ukrainian drone attacks and planned and unplanned technical outages.
According to estimates based on data from industry sources compiled by Reuters, the Russian oil refining capacity that’s now offline jumped by 34% in September.
As more of Russia’s refining capacity is now offline, this could lead to higher crude oil exports as Russia doesn’t have too much storage space to store crude in tanks.
Market sources told Reuters earlier this week that the September loading plans for the oil export terminals on Russia’s Baltic ports have been revised slightly higher.
Apart from some seasonal maintenance, the Russian refining capacity has seen more idle units because of Ukrainian drone attacks on Russian oil and energy infrastructure.
Energy installations have been key targets in the conflict by both sides.
Ukrainian attacks on Russian refineries and other energy infrastructure have become a fixture this year, with drones the weapon of choice for conducting the strikes.
Ukraine continues to target refineries in Russia and some of these attacks have affected further product supply from Russian refineries.
In recent months, Russia has seen higher-than-expected maintenance and repairs at its refineries after Ukraine stepped up its drone attacks early this year on the Russian refining capacity. In addition to unplanned repairs to fix damages from the drones, some refineries have been undergoing planned maintenance. This dragged down Russia’s fuel output and exports earlier this year.
In the middle of August, the Russian government said that Moscow is extending its ban on gasoline exports from October to the end of December 2024, as it seeks to keep domestic supply stable amid seasonal demand and scheduled repairs at refineries.
[Report by Tsvetana Paraskova for Oilprice.com]
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