Ukraine Strikes Gazprom's 200,000-Bpd Salavat Refinery in the Urals

Ukraine launched a series of attacks on Russian refineries and export infrastructure on Thursday, causing significant disruptions to Moscow's oil revenue. One such target was Gazprom's Neftekhim Salavat complex, a 200,000-barrel-per-day facility located in Russia's Bashkortostan region. The attack resulted in a fire at the facility, which was reportedly started by debris from falling drones. This is not the first time Salavat has been targeted; it was also attacked in mid-July.

Another Urals refinery, the 120,000-bpd Orsknefteorgsintez plant in the Orenburg region, has been severely impacted by the strikes. It has ceased operations altogether, with repairs expected to take up to six months due to the difficulty in replacing damaged equipment amidst sanctions. The refinery was hit on Monday, and the city of Orsk faced a subsequent drone strike on Thursday.

Ukraine's strategy of repeatedly targeting Russian refineries and export infrastructure aims to reduce Moscow's oil revenue and tighten domestic fuel supplies. The refinery outages have already led to gasoline shortages in Russia, prompting the country to restrict exports of gasoline, diesel, and jet fuel. In response, Russia has started importing gasoline from India. A 42,000-ton cargo from Nayara Energy's Vadinar refinery in India arrived in Russia on August 5, as reported by Kpler data.

The outages have caused processing losses of about 3.6 million barrels per day in July, which is over 30% below seasonal levels, according to EA Analytics estimates cited by Bloomberg. This has also affected Russia's export numbers, with seaborne petroleum-product exports falling by 33% in July from June and nearly 55% from a year earlier. The reduction in available fuel supplies is further exacerbated by the disruption of Russian refineries, putting additional pressure on the infrastructure needed to move crude abroad.