Russia Says Fuel Crisis Is Easing as Refineries Restart
Deputy PM Novak's stabilisation claim comes as Ukraine's drone campaign has hit roughly 20% of Russian refining capacity simultaneously.
Russia's Deputy Prime Minister Alexander Novak said on Sunday (2026-07-26) that the country's domestic fuel crisis had begun to ease, with a number of refineries restarting operations after a prolonged period of disruption. "The situation is gradually stabilizing, a number of oil refineries have resumed," Novak said, according to reporting cited by OilPrice.com. ICE Brent crude front-month was trading at $90.17 per barrel on Monday (2026-07-27), down 1.02% on the session.7
The Novak statement deserves scrutiny. Ukraine's drone and missile campaign has been systematic and escalating. The Economist reported in May (2026-05-19) that as much as 20% of Russia's refining capacity was offline at any one time, with some unconfirmed estimates placing the cumulative affected share at 40%. Reuters reported separately that roughly 17% of Russia's oil-refining capacity had been at least temporarily taken out. Restarts announced by officials do not necessarily mean capacity is restored at scale.4
Among the facilities hit is the Ryazan refinery, one of Russia's largest fuel-processing plants, located 200 kilometres from Moscow and capable of producing 340,000 barrels a day under normal operations. Damage to that single asset alone represents a significant share of domestic output. The Economist reported that approximately 60% of deep strikes on Russian territory have been carried out by Ukrainian Fire Point FP-1 drones, which can reach targets 1,500 kilometres inside Russia and carry electronic-warfare countermeasures.4
The refinery disruptions have already pushed Russia toward its neighbours. As of late June (2026-06-26), Russia was seeking to purchase significant volumes of gasoline from Kazakhstan to cover domestic shortfalls. Astana was hesitant, apparently weighing the risk that fulfilling Russia's request could compromise Kazakhstan's own export commitments and draw unwanted political attention. Whether that negotiation has progressed is not stated in available reporting.6
India felt the supply knock-on earlier. In April, India imported crude oil worth €4.5 billion from Russia, down from €5.3 billion the previous month, driven in part by a shutdown at the Nayara refinery. That drop in Indian offtake mattered for Urals pricing dynamics; with fewer buyers competing for discounted barrels, the pressure on Russia's export revenue was compounding. Urals crude was quoted at $84.26 per barrel on Monday (2026-07-27), a discount of roughly $6 to ICE Brent front-month.5
The wider regional exposure has been sharpest for Australia. The Australian government announced on 19 May (2026-05-19) plans to spend more than A$10 billion bolstering domestic fuel security, including A$3.7 billion for publicly owned reserves capable of holding one billion litres of diesel and aviation fuel, and A$7.5 billion to support fuel companies in accessing loans, insurance and equity to build additional stocks. The trigger was acute: over 90% of Australia's petrol, diesel and jet fuel — for both civilian and military use — is imported from Singapore, South Korea, Japan and China.2
Australia's vulnerability runs through Asian refining, not through direct Caspian or Russian supply. Around 15% of Australia's oil crosses the Strait of Hormuz, but Asian refiners that process fuel for export to Australia source 40% to 70% of their crude inputs from the Middle East. A Russian refinery restart, however partial, removes one source of regional supply tightness — but it does not address the structural dependency on Asian refining hubs that underpins Canberra's emergency spending.3
South Korea is a bellwether to watch. It is a major refiner for the region but sources roughly 70% of its crude from the Middle East. President Lee Jae Myung warned of an economic emergency during the week of 18 May (2026-05-18), and Seoul passed an additional $17 billion budget to address the strain. USD/KRW was trading at 1,469 on Monday (2026-07-27), up 0.66% on the session.1
RBOB Gasoline futures were at $3.31 per gallon on Monday (2026-07-27), down 0.60%, while US Heating Oil futures edged up 0.50% to $4.06 per gallon. The divergence in petroleum product prices on the same session suggests traders are not yet pricing a clean Russian supply recovery uniformly across the barrel.7
Novak's statement may prove accurate over weeks if restarts hold and drone pressure eases. But Russian officials have previously announced stabilisation that did not last. The next verifiable signal will be whether Russia's domestic fuel queues shorten and whether Kazakhstan receives — or declines — a formal purchase request that would confirm Moscow still cannot cover its own supply gap without external help.6,7