Is Russia’s fuel crisis a temporary squeeze or the collapse of an industry? Two leading economists debated the question, unable to agree on how much refining capacity is left.
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 oil refineries, Russia’s refining output remains fairly high. By his estimate, refining has fallen by only 25–28%. Two days later, economic commentator Vyacheslav Shiryaev criticized Vakulenko on the same program, calling his remarks “nonsense.” He said 65–70% of Russia’s oil refining has been knocked out, and that any optimistic assessment only helps prolong the war. After trading criticism at a distance, the two agreed to debate — first in writing, then in person on The Breakfast Show. Here’s what came of it.
In the first two sections, Meduza recaps the written portion of the debate, which the independent Russian outlet Novaya Gazeta Europe has already published. The third covers the closing stretch of the in-person discussion, when the participants answered questions from the host. (In the debate’s first part, the two sides repeated the questions and answers Novaya Gazeta had already published.) Meduza has preserved the meaning of every statement, though parts of the debate may have been edited or rearranged. Some questions and answers have been left out.
Sergey Vakulenko answers his opponent’s questions
What share of Russia’s production capacity for marketable gasoline and diesel fuel remains at this point?
Our understanding of Russian oil refining lags behind events, so it’s hard to say precisely how things stand today. For gasoline, the July 2026 range is 2.25 million to 2.65 million tons a month, compared with 3.5 million tons in March 2026. For diesel, the July 2026 range is 5.2–5.6 million tons, compared with 7.7 million tons in March 2026. The share of production capacity devoted to gasoline and diesel tells you nothing useful. Plants are very rarely run at full capacity. Exact output figures for specific products are classified. If Russia were producing 27% of its April 2026 gasoline output, as you claim, the fuel wouldn’t be reaching ordinary Russians at all. Your claim that damaged units can’t be replaced is incorrect: most of them are made in Russia.
You said this August’s crisis isn’t very different from the gasoline crises before 2022 and in 2023. By what criteria was that comparison made?
I never said the current crisis is much like the ones of previous years. What I meant was that the old problems — the ones bad laws and seasonal demand spikes cause almost every year — have been compounded by new ones caused by the strikes on refineries.
Do you agree with the data from Izvestia showing that fuel is available at only 28% of gas stations? If those figures are correct, why do you say there’s no crisis?
I said that the situation is serious and that refining volumes have fallen noticeably. But different people mean different things by the word “crisis.” I prefer quantitative assessments to qualitative labels. I studied Izvestia’s figure, and it’s misleading. You can arrive at it arithmetically, but it doesn’t mean what people usually understand by the phrase “fuel was available at 28.1% of gas stations nationwide.” GdeBENZ, a service that shows which stations have fuel, is fine for finding a station that might have gasoline, but you can’t draw sweeping conclusions from its data.
Vyacheslav Shiryaev answers his opponent’s questions
What primary data do you base your assessments on, for individual plants and for the country as a whole?
Official data on fuel output aren’t available, and what Russia’s state statistics service, Rosstat, publishes is a lie. For several months now I’ve been keeping a running spreadsheet on 40 refineries. I build it from official statements about plant shutdowns, data from analytics firms, reports in industry Telegram channels, information from sources in Russia’s energy sector, and messages from subscribers sent through an anonymous Telegram bot. I can share that spreadsheet with you.
Since the end of May, you’ve been saying that Russia’s oil refining is running at 30–35% of March levels. Where does that number come from, why hasn’t it changed, and why don’t you rely on data from Rystad, Bloomberg, and Kpler, which give higher estimates?
At the end of May, I was talking about the remaining volume of marketable gasoline production, not the overall volume of oil refining. The brief stabilization in the fuel market had two causes: Ukraine, for a time, shifted to destroying warehouses belonging to the retailer Wildberries, and the Russian government introduced anti-crisis measures. Western analytics firms can’t be trusted here, since they rely on official data from the Russian authorities. I’ll believe Bloomberg when someone points me to the person who can heroically and systematically leak information to “enemy” media without clearing it with Russia’s presidential administration — and never get caught.
What effect do you expect from your catastrophic forecasts? Do you consider yourself an expert or a fighter in the information war?
In all my forecasts, I specify that they hold only if Ukraine maintains the same intensity of strikes as in the previous week, or in whatever week. Ukraine has its own ideas about the strategy for destroying refineries. I’m the only public expert to have predicted the June fuel crisis, and I did so on May 20. If another expert says something true that I don’t like, I won’t argue. But repeating the Kremlin’s talking points about a “strong economy” and “no problems with gasoline” is unacceptable. They mislead Ukraine’s top leadership, prolong the war, and play into the aggressor’s hands.
Experts answer the host’s questions
If so little gasoline is being produced, as you say, why are cars still on the road?
Vyacheslav Shiryaev: Drivers spend more time waiting in line than driving. If gasoline is available at 28% of gas stations, you spend your time in line instead of on the road. Everything happening at gas stations confirms my numbers. If Ukraine keeps striking refineries as regularly as it has lately, only a handful of people will still be driving. Everyone else will fall back on public transportation, which isn’t built to handle that kind of load.
Do you think Russia’s oil refining industry is resilient enough that drone attacks can’t do it serious damage?
Sergey Vakulenko: A year ago, I wrote that at the level of drone pressure Ukraine was applying then, Ukraine couldn’t inflict irreparable damage. If it widens its reach, strikes more often, and delivers more explosives per raid, these plants could be destroyed sooner or later. But as of 2025, I wasn’t seeing that. I can see a scenario in which the plants really do start coming apart, but that moment hasn’t arrived yet.
Why are Russian refineries being hit at all, and why are they so poorly defended?
Vyacheslav Shiryaev: At first, no one knew how to defend them; then we saw how ineffective the defenses were. There are too many refineries, and they’re scattered across Russia. There’s no system of defenses built up over five years, the way there is in Ukraine.
Sergey Vakulenko: The short answer is that drones are so cheap and so numerous that modern military doctrine has no response to them and sees no effective defense. Even at a 95% interception rate, if 10 drones get through, they’ll do damage.
What’s the current balance between destruction and repair? Are Ukraine’s armed forces destroying plants faster than the plants can be rebuilt, or the other way around?
Sergey Vakulenko: What does “now” even mean? Ust-Luga came under heavy attack in April, and for as long as the strikes were daily, the port there sat idle. As soon as the strikes stopped, it went back to work. The same goes for refineries. If you send a swarm of 200 drones against a plant every 10 days, you can keep it offline indefinitely. After that, it’s a question of budget and of how many drones Ukraine’s armed forces have.
Vyacheslav Shiryaev: The plant in Orsk won’t run for six months — that’s an official statement from the governor. It’s a similar story at one of Lukoil’s biggest plants. You don’t need to keep the plants under constant pressure; you just need to finish “taking out” the remaining units. That’s the fundamental difference from a port: there’s nothing at a port you can “take out” to paralyze the whole operation.
Could refineries be placed under temporary state management under Putin’s new decree, on the grounds that they’re poorly protected critical infrastructure?
Sergey Vakulenko: They could! I haven’t asked lawyers what the decree means, but there’s no point poring over the decrees Russia is issuing now. It will be whatever they want it to be.
Vyacheslav Shiryaev: If I were Lukoil, I’d be worried — the company is first in line. Four plants are down, and I wouldn’t be surprised if Lukoil gets carved up.
Where will Ukraine’s campaign of strikes lead, and when will Russia run out of gasoline?
Vyacheslav Shiryaev: Gasoline will never run out completely. There are refineries drones can’t reach. Some fuel will always come in from Belarus, unless it decides to enter the war. At some point, Russia will be down to producing 10,000–15,000 tons of gasoline a day. If Ukraine finishes off the remaining plants, Russia is doomed.
Sergey Vakulenko: I disagree with Vyacheslav on the numbers, but Ukraine’s armed forces really do have the physical capacity to stop gasoline production in the European part of Russia. In the Asian part, it’s harder.
Will 92-octane gasoline cost 200 rubles a liter? And if so, when?
Vyacheslav Shiryaev: If they decide at Ukraine’s presidential offices on Bankova Street in Kyiv that gasoline will cost 200 rubles in two weeks, then that’s what it will cost. It’s all in Ukraine’s hands. They don’t even need more drones; they just need to finish off what’s left.
Sergey Vakulenko: There are plenty of reasons the price could hit 200 rubles. The state could decide that it no longer needs to subsidize gasoline consumption — that it will let “the market sort it out.” Then gasoline would cost 200 rubles, but without the lines. The other scenario is intensified attacks, leaving the government no choice but to raise the price. It’s a real possibility, but I won’t try to predict when.
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