One of my readers — I think it was JBO — recently asked at what stage Ukraine’s attacks on Russian refineries would become potent enough to truly tip the scale. I told him there’s someone far better equipped to answer that question.
His name is Sergei Vakulenko, Senior Fellow at the Carnegie Russia Eurasia Center, and formerly the head of strategy and innovation at Gazprom Neft.
Here are the key takeaways from his recent analysis in The Moscow Times:
On paper, Russia can refine 327 million tons of oil every year (or 6.5 million barrels per day). And the capacity of the 16 refineries that have been attacked by Ukrainian drones in August and September is 123 million tons a year — or 38% of the total. In other words, 38% is the upper limit of potential damage.
Every year, Russia refines up to 270 million tons — so at least 22% of the country’s total capacity is always idle (there are various reasons for this, but one is that there is a lot of old equipment in place that just hasn’t been decommissioned). Russian domestic consumption of oil products is about 120 million tons a year, with the rest sent for export.
