Page 29 - RusRPTJun24

With limited oil storage capacity, Russia faces a tough choice: either increase crude oil exports at lower prices or shut wells. Should Russia halt production, global oil prices would rise, driving up Russia’s own costs for fuel, but reducing the oil export revenues it needs to cushion the blow.
And Russia is already ramping up crude oil exports as the production of refined products fall, with monthly shipments rising by 9% between February and March, reaching a nine-month high. Conversely, the country's refined fuel exports have plummeted. The Ukrainian strategy is working and is inflicting palpable pain on Russia’s oil business. Diesel production has fallen by 16%, and gasoline production by 9% since Ukraine began targeting Russian refineries.
Wholesale fuel prices in Russia have surged due to the reduced refining capacity. Gasoline prices rose by 23%, and diesel prices jumped by 47% in western Russia between the end of 2023 and mid-March, according to KSE. Gasoline hit a six-month high in April, rising over 20% from January, forcing the Kremlin to ask for help from its friends in Belarus and Kazakhstan.
Russian consumers have so far been shielded from the wholesale price hikes, but retail diesel prices surged by 10% in the last week of April. This indicates that oil companies might be absorbing the price increases, reducing their margins, or that the Kremlin has expanded fuel subsidies.
In the end, Ukraine's strikes have weakened Russia's refining capacity without significantly affecting global oil prices, reducing the Kremlin's income and increasing domestic fuel costs, all while forcing Russia to rely more on crude oil exports to sustain its economy.
2.11 Putin warns of war in Victory Day speech
Russian President Vladimir Putin accused the West on Thursday of risking a global conflict and said no one would be allowed to threaten the world's biggest nuclear power as Russia marked the Soviet Union's victory over Nazi Germany in World War Two, reports Reuters.
As Russian troops advance against Ukraine's Western-backed forces, Putin accused "arrogant" Western elites of forgetting the decisive role played by the Soviet Union in defeating Nazi Germany, and of stoking conflicts across the world.
"We know what the exorbitance of such ambitions leads to. Russia will do everything to prevent a global clash," Putin said on Red Square after Defence Minister Sergei Shoigu reviewed troops lined up in a rare May blizzard.
"But at the same time, we will not allow anyone to threaten us. Our strategic forces are always in a state of combat readiness."
Putin, who sent his army into Ukraine in 2022, casts the war as part of a struggle with the West, which he says humiliated Russia after the Berlin Wall
29 RUSSIA Country Report June 2024 www.intellinews.com