Attacks
In July, the intensity of strikes against Russian energy facilities was somewhat higher than in May. Fourteen successful attacks on refineries were recorded (the Moscow Refinery was attacked twice). Only LUKOIL–Nizhegorodnefteorgsintez (Kstovo), the Yaroslavl Refinery, and the Moscow Refinery were attacked both in May and June. The remaining plants had not been subjected to attacks for more than two months. This may indirectly indicate that information on the condition of facilities after previous strikes is used in target selection, and that repeat attacks may be organized once information is obtained about a plant’s recovery and return to operation.
Ten strikes were also recorded against oil depots and pumping stations. Three ports (St. Petersburg, Kavkaz, and Taman) were attacked. There were no attacks on tankers in June; however, two tankers were seized by France and the United Kingdom. An electrical substation in Belgorod Oblast was also attacked.
Key Changes
We noted the following developments in June:
Missile Strike. On May 31, the Novoshakhtinsk Refinery was attacked. This was the first recorded case of direct missile strikes using Neptune missiles against a refinery, and only the second missile attack on a refinery overall. The first was also carried out against this refinery using Storm Shadow missiles in December 2025.
No missile strikes on other refineries have been recorded, nor were there any drone attacks on this refinery between the two missile strikes.The Novoshakhtinsk refinery is located 8 kilometers from the Ukrainian border and approximately 200 km from the front line. It is the refinery closest to territory controlled by Ukraine, which likely significantly reduces the probability of missile interception and makes their use more practical.
This time, Ukrainian-produced missiles were used, which may indicate that Ukraine has developed the capability to employ missiles in strikes on refineries.
The absence of attacks between the two missile raids may indirectly indicate the duration of repairs after a missile hit: such repairs may take more than six months, significantly longer than repairs following drone attacks.
Increased Strike Range. The first attack on the Tyumen Refinery was carried out, representing a record distance for a successful refinery strike (approximately 2,000 km). At the time of writing, it is already known that the Omsk Refinery, located even farther away, was also attacked in July. This suggests a gradual expansion of the territory within which attacks using UAVs are possible.
Attack on Oilfield Equipment Manufacturing. On June 27, Ukrainian armed forces attacked the Titan-Barrikady plant. The facility manufactures missile and artillery systems, but it also produced hydraulic fracturing (fracking) equipment used to enhance oil production, including shale oil extraction.
In 2021, the first Russian fracking fleet was manufactured there[1], and it completed testing in 2024[2]. Therefore, this attack may also have weakened Russia’s ability to sustain oil production.
International Situation
Global oil prices declined in June following the partial reopening of the Strait of Hormuz. However, tensions surrounding this route remain, and passage through it is still neither free nor completely safe. Transportation has not returned to pre-war levels.
Russian oil fell by $23.4 per barrel to $60.7. Other crude grades also declined and are trading in the range of $80–85 per barrel. The discount on Russian oil reached $23.7 per barrel.
The widening discount on Russian oil has occurred while tanker freight rates have been decreasing and therefore cannot be explained by higher transportation costs. Consequently, Russian crude itself is being sold at a discount relative to other benchmarks.
Sanctions on Russian oil were reinstated in June after a suspension related to the blockade of the Strait of Hormuz.
Sanctions were also lifted from Iranian oil (temporarily, though they may be removed permanently in the future). Previously, sanctions had been lifted from Venezuelan oil as well. Russia is becoming the only country whose oil exports remain under sanctions.
Oil Production
Russian oil production declined by approximately another 80,000 barrels per day (b/d) in June, falling below 9 million bpd.
This reduction exceeds the long-term trend (around 50,000 bpd per month). It may be due to data-collection inaccuracies and could be revised next month, but it may also indicate an acceleration in production decline. Data in the following month should allow for more confident conclusions.
OPEC+ countries continue to increase oil-production quotas. At the June meeting, quotas were raised by another 188,000 bpd for the organization as a whole. Russia’s quota was increased by 62,000 bpd.
As a result, the gap between Russia’s actual production and its OPEC+ production ceiling reached 834,000 bpd.
Oil and Gas Budget Revenues
Russian federal budget revenues from oil and gas remained virtually unchanged in June at 683.6 billion rubles.
The principal tax, the Mineral Extraction Tax, declined slightly to 968.6 billion rubles (a decrease of 45 billion rubles). Oil and gas revenues in June were based on production volumes and oil-sale prices from May, when both prices and production volumes decreased.
Payments under the fuel-damping mechanism rose slightly from 204.3 billion to 210.6 billion rubles.
This indicator will play an important role in the coming months. The damping mechanism consists of payments to oil companies for supplying fuel to the domestic market. Companies receive compensation equal to the difference between global prices and exchange prices in Russia, thereby incentivizing domestic fuel supplies.
Payments under the mechanism depend on global petroleum-product prices (which in turn depend on oil prices) and on the volume of fuel delivered to the domestic market. Therefore, some reduction in these payments can be expected in the coming months.
However, continuing eligibility for these payments requires maintaining exchange-traded fuel prices near government targets. For 2026, the targets are set at 62,300 rubles per ton of AI-92 gasoline and 58,950 rubles per ton of diesel fuel.
If prices deviate by more than 20% for gasoline or 30% for diesel, damping payments are suspended. At the time of publication, exchange prices slightly exceed the maximum permitted levels. This is partly due to exchange restrictions limiting daily fuel-price increases to 0.01%; consequently, if the market-clearing price is higher, exchange quotations no longer reflect the true value of the product.
In addition, vertically integrated companies can sell the required exchange volume (10% of production) at low prices while distributing the remainder directly through their own retail networks. Cases have been recorded where fuel was sold through such networks at prices of up to 125 rubles per liter (225,000 rubles per ton).
As a result, oil companies can currently maintain artificially low exchange prices, sell fuel through their own networks at inflated prices, and simultaneously receive damping payments on that fuel.
This situation could lead to the abolition of the damping mechanism and a transition of Russia’s domestic fuel market toward global pricing. Such a scenario may gain support from the Ministry of Finance, which is actively seeking ways to reduce the budget deficit, ending damping payments could contribute to that goal.
Russia’s Domestic Petroleum Products Market
By June, it was possible to speak of a full-fledged fuel crisis in Russia.
Fuel-sale restrictions (usually limits on the amount purchased per transaction) were introduced across most regions of the country, along with restrictions on fuel sales into canisters.
Gas stations experienced queues lasting several hours, indicating widespread shortages at nearby stations. Services have even emerged to help locate gas stations with available fuel.
All of this points to a systemic fuel shortage rather than logistical difficulties or isolated local deficits.
The combination of fuel shortages and price controls has resulted in the emergence of a black market for gasoline, where prices are significantly higher. Participants in this market are nevertheless subject to prosecution by authorities.
Petroleum-product output in June was estimated at 4.5 million bpd, compared with 5.3 million bpd in June 2025, a decline of approximately 15%.
Additional evidence for this reduction comes from a 16.7% year-on-year decline in rail transport of oil and petroleum products.
Previously, gasoline production in Russia exceeded domestic consumption by approximately 10%. At present, an average monthly fuel deficit of around 5% has emerged.
While production and consumption may still have been balanced at the beginning of June, by the end of the month the decline in production may have reached 20%. Taking into account the surge in demand during the second half of June, the market fuel deficit by month-end likely reached 10–15%.
Given the existence of protected consumer groups (emergency services, municipal services, socially important industries, etc.) that receive fuel on a priority basis, the effective shortage faced by other consumers may be even greater.
No diesel-fuel shortages were observed in June. Most freight transportation, agriculture, and military equipment rely primarily on diesel fuel.
Belarus
Rising fuel prices in Russia have made the Russian market more attractive than alternative export destinations. As a result, supplies of Belarusian petroleum products have increasingly been redirected to Russia.
Prices for Belarusian petroleum products on the exchange rose as high as 127,000 rubles per ton ($1,623 per ton). Domestic wholesale gasoline prices in Belarus stood at $1,127 per ton.
Against this backdrop, exports to third countries fell from 166,000 tons in May to 24,000 tons in June (during the first 25 days of the month), while deliveries to the Russian domestic market reached 141,000 tons (compared with 59,000 tons in May).
Actual supplies may be even higher, since the published data likely do not include oil processed under tolling arrangements.
Conclusions
Strikes by Ukrainian armed forces against Russian energy infrastructure remain intense and are even increasing. Their effects have contributed to a full-scale gasoline crisis in Russia.
The strikes are concentrated on refineries and oil depots, indicating that their objective is to reduce oil-processing capacity and destroy already-produced petroleum products. Ukrainian-made missiles have begun to be used against refineries.
Russian budget revenues remain high due to elevated oil prices. However, payments under the damping mechanism also remain substantial. Conditions in the wholesale fuel market may soon lead to the suspension of these payments and an increase in official fuel prices in Russia.
The price of Russian oil on global markets fell to approximately $60 per barrel, while the discount relative to Brent widened to $23.4 per barrel.
Oil production declined by 80,000 bpd, exceeding the long-term trend. This may reflect data inaccuracies, but it could also indicate an acceleration in the decline of Russian oil output.
Total production fell below 9 million barrels per day, and unused production capacity under the OPEC+ agreement increased to 834,000 bpd.
[1] https://cdbtitan.ru/pub/1026
[2] https://sknews.kz/news/view/gidrorazryv-plasta-v-rossii-nashli-innovacionnoe-reshenie
Материал доступен на русском языке: Российская энергетика в июне 2026
