Russia's fuel crisis: economists clash over how much refining capacity remains
Two Russian economic commentators publicly debated the scale of damage Ukrainian strikes have caused to Russia's oil refining industry, but could not agree even on basic figures. One sees moderate losses, the other sees an industry collapse.
The state of Russia's oil refining industry has become the subject of a public dispute between two well-known economic commentators. On August 17, Sergey Vakulenko, a senior fellow at the Berlin-based Carnegie Russia Eurasia Center, said on The Breakfast Show that despite Ukrainian strikes on refineries, Russia's refining output remains fairly high, with a decline of only 25–28%. Two days later on the same program, economic commentator Vyacheslav Shiryaev sharply criticized this assessment as "nonsense," arguing that 65–70% of Russia's refining capacity has been knocked out and that overly optimistic assessments only help prolong the war.
Written and in-person debate
The two agreed to debate the issue, first in writing and then face-to-face. Vakulenko cited figures showing gasoline output in July at 2.25–2.65 million tons a month, down from 3.5 million in March, and diesel output at 5.2–5.6 million tons, down from 7.7 million in March. He disputed a figure from Izvestia claiming fuel was available at only 28% of gas stations, calling it misleading. Shiryaev explained that his estimates are based on a spreadsheet he maintains tracking 40 refineries, drawing on official statements, analytics firms, industry Telegram channels, and sources in the energy sector, and dismissed Western analytics firms such as Rystad, Bloomberg, and Kpler as reliant on official Russian data.
The live discussion
Answering the host's questions, Shiryaev said drivers now spend more time waiting in line than driving, and that continued regular strikes would force most people onto public transportation. Vakulenko acknowledged that Ukraine's armed forces have the physical capacity to halt gasoline production in the European part of Russia, though it would be harder in the Asian part. Both agreed that refineries could be placed under temporary state management under a new decree from Putin, and that Lukoil, which already has four plants offline, could potentially be broken up. On the possibility of gasoline reaching 200 rubles per liter, both agreed it was a realistic scenario, though they disagreed on timing.
