Attacks
In August, the intensity of strikes on Russian oil refineries increased to record levels. A total of 22 attacks were recorded. Some refineries were attacked three times during the month. In total, 14 oil refineries, the Astrakhan Gas Processing Plant, and the Central Gas Fractionation Unit in Tobolsk were damaged.
In August, the Ukrainian Armed Forces focused on oil refineries as facilities where damage can have the greatest impact. No attacks on standalone oil depots were recorded, although storage tank farms were targeted during attacks on ports. A gas pumping station operated by Gazprom Transgaz Moscow was also attacked. Four attacks on ports were recorded, although their impact was limited.
Along with the attack on the oil depot at the Port of Taman, the nearby 500 kV Taman electrical substation was also attacked. Another attack was recorded against the 330 kV Kurskaya substation. Along with oil refineries, substations represent another type of facility that can be significantly damaged by drones without the use of missiles. One attack on a substation had previously been recorded in July, while the previous attack before that took place in April. The increase in the number of such incidents may indicate growing interest in power grid infrastructure, although two attacks are insufficient to establish a sustained trend. One possible scenario is an increase in the number of strikes on substations as the winter period approaches.
Attacks on tankers in the Black Sea are continuing. Four tankers are known to have been attacked, although the actual number may be higher, as oil loading volumes at Black Sea ports remain significantly below normal levels, suggesting that their blockade is continuing.
Key Developments
We identified the following key developments in August.
Decision on temporary management of assets. On 24 August 2026, Putin signed Decree No. 604, “On Measures to Ensure the Security of Critical Infrastructure Facilities of the Russian Federation.” It provides for the introduction of temporary management of an enterprise’s assets if the owner fails to ensure adequate protection of the facility, including against UAVs, or fails to resume its operation within the prescribed timeframe. The mechanism also applies to the fuel and energy sector.
There had previously been indications that some refineries were being repaired but were not resuming operations. If another attack occurs within several days after operations resume, the refinery operates for only a very short period. Under such conditions, restoring equipment merely creates additional costs without increasing refining volumes. The decree therefore creates an additional incentive for refinery owners both to invest in protecting facilities against UAVs and to restore damaged capacity and resume operations as quickly as possible. One possible objective of the mechanism is to prevent a situation in which it is more economically advantageous for an owner to leave repaired equipment idle for an extended period because of the risk of another strike.
Depletion of reserves. If the share of filling stations where gasoline is available is used as a qualitative indicator of market conditions, it can be observed that the increase in the intensity of attacks on refineries in August was quickly accompanied by deteriorating fuel availability at filling stations. This may indicate a reduction in buffer stocks of petroleum products and the system’s limited ability to compensate for lost production using previously accumulated reserves.
However, this indicator cannot be used to directly estimate the physical volume of inventories. Fuel availability at filling stations is also affected by the regional distribution of stocks, logistical constraints, and changes in demand.
Sanctions and supplies from neighbouring countries. On 23 August, the refinery in Kulevi, Georgia, announced that it had switched to non-Russian crude oil. Earlier, in July, the EU included Kulevi in its 21st sanctions package, imposing a transaction ban with a six-month transition period. Under the threat of EU sanctions, Kulevi began switching from Russian crude to Kazakh and Libyan oil. The operator announced that the transition had been completed on 23 August, although independent CREA data have not yet confirmed a complete phase-out of Russian crude[1].
In July, Kazakhstan and Russia held talks on a tolling arrangement under which Russia could supply its crude oil to Kazakh refineries, after which some of the petroleum products produced would be returned to Russia. Kazakhstan’s Ministry of Energy confirmed the talks to Reuters, although no volumes or specific refineries were identified at the time[2].
At the same time, Kazakhstan allowed large refineries to export gasoline to Russia. The Pavlodar refinery received a quota of 17,500 tons in July, while the Atyrau refinery was granted a similar opportunity in August. However, neither refinery ultimately began deliveries. The reasons included the need to preserve fuel for the Kazakh domestic market, difficulties with payments through Russian banks, and the risk of Western sanctions. Actual gasoline deliveries to Russia were made only by the much smaller Condensate refinery[3], a Kazakh refinery with an annual crude processing capacity of 850,000 tons.
Russian Domestic Petroleum Products Market
Gasoline Imports into Russia
On 5 August, the first shipment of gasoline from India, amounting to approximately 42,000 tons, arrived in Russia[4]. Поставки осуществляются через порт Мурманска. Это может быть связано с загрузкой других портов экспортными потоками, а также с их специализацией непосредственно на экспорте. Мурманск имеет мощности по приёмке нефти и нефтепродуктов. Кроме того, этот порт ещё не подвергался атакам, и, вероятно, доставка туда нефтепродуктов более безопасна.
Deliveries are handled through the Port of Murmansk. This may be related to other ports being occupied with export flows, as well as their direct specialization in exports. Murmansk has infrastructure for receiving crude oil and petroleum products. In addition, the port has not yet been targeted by attacks, making deliveries of petroleum products there potentially safer.
Nevertheless, as of 18 August, the first gasoline shipment was still at the port. The reason was the price. Suppliers were prepared to sell gasoline at RUB 150,000 per ton, taking into account global prices and transportation costs. At the same time, gasoline was priced at RUB 77,000–78,000 per ton on the Russian exchange. Restrictions on price movements on the exchange effectively paralyzed its use as a mechanism for determining the equilibrium fuel price. Sales began only on 19 August. A sale of 1,020 tons at RUB 105,000 per ton is known to have taken place[5]. The sale price for the remainder of the gasoline is unknown; it may have been sold on the over-the-counter market.
Russia already operates an import damper mechanism for motor gasoline, intended to make fuel imports more economically attractive when there is a substantial difference between external and domestic prices. However, this was probably the first application of such a mechanism to supplies from outside the immediate region, which may explain why arranging the sale of this gasoline shipment took considerable time.
The mechanism was tested with the first shipment, which probably also contributed to the delay.
The situation improved with subsequent shipments, and imports of additional petroleum product cargoes continued. Slightly more than 300,000 tons of foreign petroleum products were imported through Russian ports in August. Deliveries were handled through ports in the Baltic and Arctic basins[6].
Analysis of Petroleum Product Production
Strikes on oil refineries in recent months have kept crude oil processing slightly below 4 million b/d, or approximately 25–30% below normal levels. OPEC has also published data estimating refining volumes on a quarterly basis. So far in the third quarter of 2026, refining volumes stand at 3.95 million b/d[7].
Nevertheless, such a reduction in refining does not mean that 30% less gasoline is being sold in Russia. Part of the decline is compensated for by supplies from other sources.
A reduction in refining of 1.5 million b/d corresponds to approximately 6.2 million tonnes per month. In 2023, the average gasoline yield was 16%, while the diesel yield was 32%[8]. The reduction in gasoline production can therefore be estimated at approximately 1 million tonnes per month. However, secondary oil processing units are also known to have been damaged, which may further reduce gasoline output at the same level of primary refining and creates uncertainty when estimating the decline in gasoline production.
The following measures are being used to compensate for this reduction.
Suspension of exports. On average, before 2024, 10–13% of gasoline production was exported, equivalent to approximately 360,000 tons per month. However, not all of this volume can be removed from exports. Certain volumes of petroleum products supplied under intergovernmental agreements are known to continue to be exported, although available data do not allow the volume of such deliveries to be estimated.
Imports of petroleum products. Belarus is known to have supplied 260,000 tons of gasoline in August[9]. An estimated 170,000–205,000 tons of gasoline were imported from other countries based on individual cargoes. At the same time, total petroleum product imports in August are known to have amounted to 300,000 tons[10]. Since gasoline is the petroleum product in greatest demand, additional deliveries probably took place, and total gasoline imports may have reached as much as 250,000 tons.
Until 2023, Russia exported naphtha, with exports reaching 17.1 million tons per year[11], or 1.43 million tons per month. In July 2026, naphtha exports amounted to approximately 1 million tons per month, 30% below the 2023 level and broadly corresponding to the reduction in crude refining. Naphtha is a feedstock that can be converted into finished gasoline after additional treatment and octane enhancement. However, no significant additional reduction in naphtha exports has occurred, suggesting that naphtha is not being used in substantial additional volumes for gasoline production. The relaxation of gasoline quality requirements to the Euro 2 standard was probably necessary to maintain gasoline output at refineries in the event of damage to individual secondary processing units.
Thus, assuming there is no significant additional use of naphtha for finished gasoline production, the suspension of exports, supplies from Belarus, and seaborne imports from other countries together make it possible to compensate for approximately 700,000–850,000 tons of the estimated 1 million ton decline in production. With average annual consumption of 3.2 million tons per month, this corresponds to an actual gasoline deficit on the Russian market of approximately 5–10%.
It is important to note that these calculations use unofficial data on the production, export, and consumption of petroleum products. They do not account for several factors that cannot be quantified using the available data. The seasonal factor, which probably increases gasoline consumption at the end of summer, was not considered. Nor was possible growth in gasoline consumption since 2023. At the same time, there is a possibility that supplies from Belarus under tolling arrangements are not included in the statistics. The margin of error may therefore be significant. Nevertheless, the calculations support a qualitative conclusion: the gasoline deficit on the Russian market is significantly smaller than the reduction in refining volumes and is highly likely to be within the range of 5–15%.
An estimate based on the decline in the number of road accidents[12] indicates a reduction in vehicle mileage and, consequently, fuel consumption of 10–11%, which correlates well with the calculation above.
International Situation
Global oil prices increased somewhat in August — by an average of $5 per barrel — due to restrictions on oil transportation through the Strait of Hormuz. Urals prices increased even more, by more than $8 per barrel, somewhat narrowing the discount of Russian crude to Brent.
The increase in Russian oil prices was probably driven by stronger demand. The volume of Urals crude at sea is known to have declined. Over the course of the month, these volumes fell by more than 20 million barrels. China’s position probably plays a key role in this trend, as the country had already increased its overall crude oil imports, as well as imports from Russia specifically, in July. This trend probably continued in August.
Oil Production
Russian oil production amounted to 8.72 million b/d in August, falling by 160,000 b/d, more than three times the normal rate of production decline. In August 2025, production stood at 9.17 million b/d, meaning that output declined by approximately 5% year on year.
The reduction in oil production may be related not only to the upstream sector itself but also to constraints on crude refining and exports. As noted above, the reduction in crude processing in August amounted to approximately 1.5 million b/d. It was probably not possible to redirect these volumes fully to exports, particularly given the partial blockade of the Port of Novorossiysk. Under normal operating conditions, an average of 7–8 tankers are loaded per week at the port, whereas in August only 2.2 tankers per week were dispatched on average, with no loading at all between 9 and 16 August. Although some increase in shipments through other ports has been observed, overall crude oil loading declined. It should be noted that this estimate is based solely on the number of tankers loaded and does not account for differences in vessel size. It should therefore be regarded primarily as a qualitative estimate and does not allow the reduction in exports to be quantified.
The decline in production, combined with the continuing increase in quotas under the OPEC+ agreement, has resulted in Russia producing 1.17 million b/d below its permitted level.
Oil and Gas Budget Revenues
Russia’s oil and gas budget revenues fell to RUB 424 billion in August.
Receipts from the main tax — the mineral extraction tax — increased slightly to RUB 702.7 billion, of which RUB 592.6 billion came from oil, with the remainder coming from natural gas and gas condensate production. However, the sharp decline in overall revenues was primarily associated with an increase in payments under the fuel damper mechanism, from RUB 113 billion to RUB 197.3 billion. These payments depend not on the oil price itself but on petroleum product prices on the global market. The market is currently characterised not only by high crude oil prices but also by high refining margins, meaning that petroleum product prices are rising faster than crude prices. An increase in the export alternative, combined with relatively slow adjustment of the statutory indicative domestic price, increases the amount of budget compensation.
The fuel crisis therefore creates a double negative effect for the Russian budget: problems in refining and exports constrain the revenue base, while the need to retain fuel on the domestic market simultaneously increases government expenditure on support for refining companies. Additional costs also arise from mechanisms supporting fuel imports, although these should be considered separately from the traditional fuel damper.
Belarus
A source cited by Kommersant provided approximate figures for gasoline supplies from Belarus as of late August 2026[13]. According to the source, “from June through 26 August, the volume had already exceeded 570,000 tonnes.” Taking into account known supply volumes in June and July, this suggests that 217,000 tonnes of gasoline were supplied during the first 26 days of August, with the total for the full month expected to reach approximately 260,000 tonnes. All gasoline exports have been redirected to Russia, and this volume most likely does not include supplies under tolling arrangements.
Naftan is known to be scheduled for planned maintenance in September. A complete shutdown of the refinery is unlikely. More likely, capacity will be partially reduced due to the shutdown of individual processing units, although gasoline supplies will probably decline somewhat.
Gasoline production has approached its March 2026 peak and remains slightly below the December 2025 peak.
Gas Sector
Gazprom plans to build a large LNG plant in Ust-Luga using its own technology. Previously, major LNG projects in Russia were built with the involvement of Western licensors and imported equipment. Attempts were made to develop liquefaction trains partly based on domestic technologies, although some technologies and equipment remained foreign. The new project is planned to use the Russian Gazprom DMR technology.
Due to high gas prices, European buyers sharply reduced spot LNG purchases. The situation in Belgium was particularly illustrative: in July, the country imported approximately 0.4 million tons of LNG, with the entire volume coming from Russia under long-term contracts[14].
Russia produced 2.3 million tonnes of liquefied natural gas (LNG) in July 2026, 14.2% more than a year earlier, while production in the first seven months of the year increased by 12% year on year, according to Rosstat. Russia’s large-scale LNG production capacity includes the Sakhalin Energy plant (co-owned by Gazprom, Mitsui, and Mitsubishi), Yamal LNG (whose shareholders include NOVATEK, TotalEnergies, China’s CNPC and SRF), Arctic LNG 2, Gazprom LNG Portovaya, and Cryogas-Vysotsk.
Over the past six months, Russia has expanded its “shadow fleet” for LNG transportation by at least eight second-hand LNG carriers. The overall fleet now numbers up to 25 vessels, including two new Arc7 ice-class tankers built at the Zvezda shipyard. These two LNG carriers are capable of transporting LNG from Arctic plants via the Northern Sea Route without icebreaker assistance. A total of 15 such tankers are planned to be built at Zvezda for Arctic LNG 2, although sanctions restrictions have delayed implementation of the project.
Coal
New coal production data have been released[15]:
- In January–July 2026, total coal production declined by 1.8% year on year to 249 million tonnes. In July 2026, production amounted to 32.7 million tonnes, 2.5% higher than in July 2025 but 6.3% below the June 2026 level.
- Hard coal production in January–July 2026 amounted to 192 million tonnes, down 2.3% year on year, including 12.1 million tonnes of anthracite (-1.9%).
- Coking coal production increased by 1.2% to 64.3 million tonnes.
- Production of other hard coal amounted to 116 million tons (-4.3%).
- Lignite production amounted to 56.6 million tons (-0.1%).
Overall, Russian coal production declined by 0.2% in 2025 to 429 million tons.
The structure of Russian coal exports to China changed significantly in 2026. In the first half of the year, coking coal supplies increased by 16% to 17.3 million tons, while exports of thermal coal excluding anthracite fell by 39% to 12.5 million tons, and anthracite exports also declined by 39% to 5.1 million tons. As a result, total Russian coal exports to China fell by 20% to 34.9 million tons despite higher coking coal supplies.
Coal prices have a certain correlation with gas prices because the two fuels can substitute for each other in electricity generation. Consequently, when gas becomes more expensive, producers switch to coal, increasing demand and supporting higher prices. In anticipation of higher coal prices in the near future, China is generally increasing coal imports to build inventories.
Prices for Russian thermal coal at ports in the Northwest and Far East increased by 4.2% and 2.5%, respectively, in the second week of August. Higher consumption in China is only one of the factors. There are also difficulties with coal shipments from Russian ports on the Black Sea and uncertainty surrounding Indonesian exports.
Conclusions
Ukrainian strikes on Russian energy infrastructure reached their highest intensity in August. Oil refining remains the main target, while repeated attacks are complicating the restoration of damaged facilities. Crude oil processing remains below 4 million b/d, approximately 25–30% below normal levels. However, this has not resulted in a comparable reduction in gasoline supply: the suspension of a significant share of exports, supplies from Belarus, and growing seaborne imports are compensating for most of the lost production. The actual gasoline deficit can be estimated at approximately 5–15% of normal demand, although it is significantly higher in some regions.
Problems in the refining sector are beginning to affect the entire oil industry. In August, production fell by 160,000 b/d to 8.72 million b/d despite the continued increase in permitted production levels under OPEC+. Russia is now producing approximately 1.17 million b/d below its permitted level. One reason may be the inability to fully redirect crude displaced by lower refinery runs to exports amid constraints on port infrastructure. At the same time, higher global oil prices and a narrower Urals discount partially compensate for lower physical volumes, while China continues to increase purchases of Russian crude.
The fuel crisis is simultaneously increasing the burden on the budget: payments to oil companies under the damper mechanism rose from RUB 113 billion to RUB 197 billion and may increase to approximately RUB 280 billion next month. Belarus has become one of the key sources of additional gasoline for the Russian market, although the potential for further increases in supplies is constrained by refinery utilization and planned maintenance at Naftan. In other sectors, the situation remains more stable: LNG production continues to grow, Russia is expanding its own technological and transport infrastructure for LNG exports, while the coal industry continues to experience a moderate decline in production and Chinese demand is shifting from Russian thermal coal towards coking coal.
- [1] https://energyandcleanair.org/august-2026-monthly-analysis-of-russian-fossil-fuel-exports-and-sanctions/
- [2] https://www.reuters.com/business/energy/kazakhstan-talks-process-russian-crude-amid-russia-fuel-shortages-2026-07-30/
- [3] https://arbatmedia.kz/news-kz/pavlodarskii-i-atyrauskii-npz-otkazalis-ot-postavok-benzina-v-rossiyu-9599
- [4] https://murmansk51.info/2026/08/18/indiiskii-benzin-v-murmanske-pervaya-partiya-pribyla-no-tsena-derzhit-situatsiyu-pod-kontrolem/
- [5] https://www.interfax.ru/business/1110569
- [6] https://www.kommersant.ru/doc/8955376
- [7] https://www.opec.org/monthly-oil-market-report.html
- [8] https://m.interfax.ru/944803
- [9] https://www.kommersant.ru/doc/8922767
- [10] https://www.kommersant.ru/doc/8955376
- [11] https://www.hydrocarbonprocessing.com/news/2024/01/russia-may-cut-naphtha-exports-by-third-after-fires
- [12] https://carnegieendowment.org/ru/russia-eurasia/politika/2026/09/russia-oil-crisis-signs
- [13] https://www.kommersant.ru/doc/8922767
- [14] https://ru.themoscowtimes.com/2026/08/03/44-9-a202542
- [15] https://www.interfax.ru/business/1111421
Материал доступен на русском языке: Российская энергетика в августе 2026
