CorrectionThe 17 July Daily Briefing described a ~20% fall in European gas that did not happen — August TTF settled at €54.79/MWh on 16 July, essentially flat. During our platform rebuild, a retired machine running an outdated data feed briefly came back online and republished week-old settlements as live prices. The briefing has been withdrawn, and live prices are now verified against exchange settlement history before publication.
Russia Turns to Indian Gasoline as Drone Strikes Cut Refining Capacity
Ukrainian strikes have pushed Russian refining to a 21-year low, forcing Moscow to reverse its crude-for-fuel trade relationship with New Delhi.
An initial shipment of at least 60,000 metric tons of gasoline — roughly 510,000 barrels — has departed India aboard two tankers bound for Russian ports, Reuters reported, marking an extraordinary reversal in the energy relationship between the two countries.3
Russia has spent the past two years selling discounted crude to Indian refiners at volumes reaching 2.6 to 2.7 million barrels per day in June, more than half of India's total oil imports. Now those same refiners, or traders connected to them, are sending the processed product back.3,1
The cause is the scale of damage from sustained Ukrainian drone attacks on Russian refining infrastructure. Ukrainian strikes have taken offline roughly 30% of Russia's oil refining capacity, driving throughput to a 21-year low during peak summer demand.3 Some industry projections cited in the Reuters report put the offline share as high as 40% through July and August, a figure that aligns with President Vladimir Putin's own acknowledgment that fuel queues have formed at stations and supply problems persist for motorists and businesses.2
With domestic gasoline consumption running at least 110,000 metric tons per day in the summer months, Moscow faces a deficit of around 25,000 tons — approximately 212,500 barrels — per day, according to Reuters. Belarus has moved to help, tripling its rail deliveries of gasoline to Russia to over 70,000 tons in the first half of June (2026-06-30). Still, those flows leave a gap that domestic production and regional allies cannot close alone.3
India's government has distanced itself from the flows. Oil Minister Hardeep Singh Puri said at a media briefing that "Indian companies are not selling fuels to Russia," while acknowledging that it is "possible" traders are routing supplies through. The distinction matters politically but less commercially: the Reuters shipment data indicates the product is moving regardless of the direct-seller question.4
RBOB gasoline front-month sits at $3.39 per gallon as of Friday (2026-07-17), and contrarian signals in the packet flag the market as carrying bullish supply and demand pressure against a broader bearish consensus on crude. A Russian import program drawing on Asian refining capacity, even at the volumes reported, would divert cargoes that might otherwise flow toward Atlantic basin demand — a marginal but directional tightening effect on global gasoline balances.3
The structural oddity is this: India became Russia's largest crude customer precisely because Western sanctions made Russian barrels cheap and available. The flow that emerged — Russian crude in, refined product revenue back to India — is now partially reversing. Indian refiners process discounted Urals, currently trading at $66.62 per barrel, and sell the output at global product prices. The gasoline trade is a logical extension of that margin capture, provided political risk stays manageable.1
How long India can sustain that posture is uncertain. Puri's denial suggests New Delhi is watching secondary sanctions exposure carefully. The United States has previously warned that enabling Russian energy supply chains could attract penalties, and the minister's careful parsing — companies versus traders — reflects the room India is trying to preserve.4
On the Russian side, the refinery damage picture will determine how persistent this import requirement becomes. A 30% capacity loss during peak summer demand is severe enough to require outside supply at current consumption rates; if the drone campaign continues at its recent pace through August (2026-08-31), the deficit does not self-correct. Moscow's ability to source volumes from India through intermediary traders will hinge partly on whether US pressure on Indian institutions tightens further.3,2
The RBOB gasoline market's direction through late July (2026-07-31) and August (2026-08-31) will partly reflect whether additional Russian demand continues to pull on Asian refining capacity — or whether political pressure closes that channel before Moscow finds a domestic fix.3,4