Ukraine’s Strikes Against Russian Oil Refineries Risk Worsening The Global Energy Crisis

By Andrew Korybko

The further reduction of Russian oil exports could lead to a price spike that destabilizes the global economy and ultimately weakens the US’ one as well, but it’s unclear whether Trump will punish Zelensky for this or if he cynically wants him to facilitate that scenario as part of a global reset.

The Slavneft-YANOS oil refinery in Russia’s Yaroslavl Region, which is among its top five largest and capable of refining 15 million tons of oil per year, was reportedly hit by Ukrainian drones early Saturday morning. This follows last week’s bombing of Ust-Luga’s oil refinery and port, which prompted speculation that Russian oil producers might soon declare force majeure. Shortly afterwards, Russia announced that it’s banning gasoline exports for an indeterminate length of time.

Amidst the aforementioned sequence of events, Reuters calculated that 40% of Russia’s oil export capacity had been halted, which includes the consequences of earlier strikes against other Russian refineries. Even though the Kremlin hasn’t confirmed this statistic, there shouldn’t be any doubt that these regular attacks have at the very least reduced its export capacity to some extent. This is troubling from the US’ official perspective since it envisages Russian exports alleviating the global energy crisis.

After all, it was with this goal in mind that Treasury Secretary Scott Bessent temporarily waived the US’ sanctions on everyone’s purchase of Russian oil after first doing so with India’s, yet the combination of Ukrainian strikes against its refineries greatly complicate these plans. As a result, global supply might be further reduced, thus leading to protracted price spikes that raise prices across the board, reduce consumer spending the world over, and therefore indirectly weaken the US economy.

To be sure, it was argued here that the US might cynically want to exacerbate the global energy crisis upon calculating that it could manage the systemic consequences thereof by retreating to the Americas, all while Afro-Eurasia is destabilized and then divided-and-ruled by the US. While that’s possible, Trump 2.0 doesn’t appear to prefer that option right now as suggested by its temporary sanctions waiver on everyone’s purchase of Russian oil, but it could still flexibly adapt to that scenario if it unfolds.

For these reasons, he and his team might not have preapproved Ukraine’s recent strikes against Russia’s energy infrastructure, in which case they’d have been a unilateral decision by Zelensky at the expense of the US’ previously described interests. In that event, he might have sought to exploit Trump’s hyper-focus on the Third Gulf War to continue hitting the Kremlin’s coffers by reducing its energy exports and thus the budgetary revenue that it receives from them, all in an attempt to coerce it into concessions.

While the US is also pressuring Russia “to make more concessions” per Foreign Minister Sergey Lavrov in a recent interview, this might not be one of the means that it had in mind for the reasons that were already explained, so it’s possible that Trump might chastise and even punish Zelensky if he doesn’t stop. The punishment could take the form of suspending arms sales to NATO for transfer to Ukraine given his sharp criticism of the bloc in recent days due to its refusal to help the US open the Strait of Hormuz.

Trump must therefore decide whether it’s more important for Russian oil exports to help manage the global energy crisis or for Ukraine to ramp up pressure on Russia by continuing to strike its refineries at the cost of worsening this crisis. If the former, then he must take some action against Zelensky, while the latter suggests that he’s leaning towards the earlier-mentioned cynical calculation of catalysing a global reset by letting the energy crisis worsen. The coming week should clarify which of these two he prefers.

Disclaimer: The views expressed in this article are author’s own and do not necessarily reflect the editorial policy of Voice of East.

Categories: Analysis, Economy, International Affairs, Russia

Tags: Economy, energy, Geopolitics, Iran, Iran-Israel War, NATO, oil production, Russia, The Gulf, Ukraine, USA