“The Russian war machine will only stop when it runs out of fuel,” Ukrainian President Volodymyr Zelensky told a gathering of Western security officials in Kyiv last month.
Zelensky was not speaking metaphorically. The Russian economy and President Vladimir Putin’s war on Ukraine are heavily dependent on the energy and revenue from Russian gas and oil, vital cash cows now imperiled by Ukraine’s drone attacks on refineries, ports and pipelines.
At least a dozen of the biggest refineries widely scattered around the huge Russian landmass have been hit with sophisticated Ukrainian-made drones this year, strikes that torched the facilities and shut down processing.
The drone attacks that have accelerated since July have cut gasoline output by nearly 20%, according to industry sources in reports by Kremlin-aligned media. The Russian business journal RBC put the share of idled refining capacity at 40% in mid-September.
The refining woes have had knock-on effects throughout the Russian energy network. Russian capacity to store crude oil ahead of refining is limited, forcing the government in February to ban exports of refined products to reserve sufficient quantities to power the war machines. But that foreign sales suspension, recently extended through the rest of this year, cuts into revenue needed to fund social services and prevent erosion of the pro-war patriotism fanned by the Kremlin since its February 2022 invasion.
At least 300 gas stations across Russia have closed since summer for lack of consumer supply. Gas production has dropped by 10%, according to the business journal Kommersant, curbing distribution to more remote regions of Russia. Even the nearly 50% rise in the price of gas this year has failed to reduce civilian demand. Sales tax has also gone up recently to 22%, amid high interest rates and home mortgage loans choking consumer spending.
The Russian-occupied Crimea region of Ukraine is among the hardest-hit, with half of all gas stations reported to be out of fuel. Gas rationing has been imposed in areas with the most severe shortages, including Crimea where drivers are limited to 30 liters—less than eight gallons. Some remote regions on the Russian mainland are limited to as little as 2.5 gallons, The Moscow Times reported last week.
Rationing has been imposed in Moscow, Ryazan, Nizhny Novgorod and the Leningrad region surrounding St. Petersburg, the state-aligned Izvestia newspaper reported. All are major Russian cities previously spared much of the war’s toll on normal life far from the Ukraine battlefields.
In fear of the gas crisis eroding pro-war patriotism, Putin’s government has boosted gasoline purchases from allied neighbor Belarus by 36% since the refinery bombardments intensified in July. Total Russian imports of gasoline in September soared by 168%, according to oil industry sources quoted by Kommersant.
The diversion of resources from priority expenditures on the war underscores the gravity of the fuel shortages caused by Ukraine’s drone attacks and the threat of rising social discontent with Putin’s “special military operation” grinding through its fourth year in Ukraine. Whether Kyiv’s targeting of Russian energy and income will force Putin to agree to a ceasefire and negotiations to end the war is uncertain—and probably unlikely—but it has been at least a contributing factor in Russia’s recent slowdown in battlefield advances compared to previous years.
Russian Deputy Prime Minister Alexander Novak, in charge of the government’s energy sector, on Wednesday called for the elimination of import duties on gasoline purchased from China, South Korea and Singapore with the aim of stockpiling gas and diesel fuel “in the context of unscheduled repairs of refueling stations and a shortage of gasoline in some regions.”
The refueling operations Novak referred to appear to be Russia’s largest oil-offloading terminal at the Baltic Sea port of Primorsk, which was struck by Ukrainian drones and set on fire on Sept. 12, forcing the terminal to suspend intake operations pending extensive repairs. Ukraine also attacked pumping stations along the Transneft Baltic Pipeline System-2, which supplies crude to terminals at the Ust-Luga offloading facility 100 miles west of St. Petersburg.
Ukraine’s strategy of defeating Russia by drone-bombing its vital energy operations comes at a time when Putin is facing another dwindling war commodity: bodies.
Putin announced the largest fall conscription target in nine years last week when he called for 135,000 new recruits by the end of the year. This follows a record spring conscription goal of 160,000. Putin also recently announced a build-up of Russian military troops to 1.5 million by 2026. The biannual replenishments of military ranks typically call up more soldiers in the spring, after schools and universities deliver freshly eligible recruits for Russia’s mandatory year of service by those 18 to 30 years old.
The Russian Constitution requires conscripts serve on their home territory, not in foreign wars. Ukraine has reported capturing ineligible novice soldiers on the battlefield since the fighting began. Russian officials concede some conscripts have been “mistakenly” sent to fight in Ukraine or volunteered to do so.
The conscription effort is placing a further financial burden on Kremlin coffers. As the war drags on and casualties mount, the Kremlin has had to raise its sign-on bonuses and salaries for recruits. The enlistment inducements can run as high as $28,000—twice the average salary for men—with monthly pay up to $3,200, about three times that of the average civilian worker.
Putin’s war passed a gruesome landmark this past summer when British defense intelligence officials and the U.S.-based Institute for the Study of War determined that Russian casualties of the Ukraine war have exceeded 1 million since its onset. The casualty tolls include deaths and injuries of a permanent and disabling nature.
Ukraine’s success in targeting Russian refineries can be attributed to its investment in sophisticated unmanned vehicle warfare and Moscow’s widespread locations of its energy infrastructure. Russia’s refineries, storage facilities, pipelines and export terminals are stationed across its 11 time zones, making repairs to the drone-struck operations more costly and time-consuming. The need to replenish the local fuel supply around stricken refineries is also more expensive the farther afield they are from the more populated areas with functioning facilities.
The question many Western analysts pose is whether Russia’s intensifying budget woes will eventually force defunding of war-fighting, a dynamic already apparent in the slowed pace of Putin’s territorial seizures coinciding with the spree of Ukrainian attacks on energy infrastructure.
In a recent article headlined “How Russia’s besieged economy is clinging on,” The Economist quoted Treasury Secretary Scott Bessent as saying “We are in a race: How long can the Ukrainian military hold up versus how long can the Russian economy hold up?”
Putin’s commitment to the war he sees as historical imperative seems to be as unflinching as President Donald Trump’s faith in getting his Kremlin friend to give it up.
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