Analysts see no link between strikes on Russian refineries and oil prices
22 March 2024 16:07
EXCLUSIVE
The Financial Times, citing its own sources, reported that Washington is secretly urging Ukraine to stop attacking Russian oil refineries. This, they say, increases global oil prices, which the Biden administration does not want on the eve of the election.
The Office of the President of Ukraine has already responded to this report. Mykhailo Podolyak, an adviser to the head of the Office of the President of Ukraine, denied that such signals were coming from Washington.
“This is fictitious information. After two years of full-scale war, no one will dictate to Ukraine the terms of its conduct,” he said,
– he said.
Komersant ukrainskyi 
asked energy market experts whether drone strikes on oil refineries could really affect world prices.
Gennadiy Ryabtsev, Director of Special Programmes at Psyche, sees no connection between drone strikes on refineries and rising oil prices.
“What do drone attacks on Russian refineries have to do with Russian oil exports? How can this affect the volume of Russian oil exports? On the contrary, a decrease in oil refining in Russia may lead to an increase in the volume of Russian oil exports, which will have no place to refine. And this, on the contrary, may reduce oil prices in the world,”
says Ryabtsev.
Instead, the world’s stock exchanges are very sensitive to such materials in global publications, he added.
“To be honest, oil quotations do not depend on the volume of Russian oil exports in any way. But if journalists from the FT and other publications say that this will affect prices, then in the end, it may indeed do so, because oil quotations and the behaviour of participants in these trades in general are determined by information drives. Articles like this, which are completely inconsistent with the real state of affairs, indicate that this is either stupidity or, on the contrary, a deliberate effort to raise prices,”
– ryabtsev believes.
Economic expert Oleg Pendzin agrees with him.
“There is no connection between the Ukrainian drones hitting Russian refineries and the price of oil on the world market. Moreover, the decrease in the total volume of Russian oil refining in Russia even leads to an increase in the supply of oil on the market, which could theoretically lead to a decrease in prices on the world market, and not vice versa. In my opinion, these statements do not have any clear economic explanation,”
– the expert believes.
He argues that the appearance of this material is primarily beneficial to Russia.
“We have repeatedly seen well-known and reputable publications publish things that are not always true and look as if these articles are paid for, including by Russian authorities. So I’m quite calm about the whole thing and I don’t believe that there will be any direct appeals from the US towards Ukraine,”
– penzin said.
Is there life without Russian oil?
Drones of unknown origin are destroying Russian refined products. And there is not much of it on the world market.
“90% of petrol and 60% of diesel produced in Russia are consumed by the domestic Russian market. That is, there is no significant impact on the international market. And the main foreign consumers of Russian petroleum products are the countries of Russia’s neighbouring countries. Therefore, a decrease in the total volume of refining in Russia does not affect the price of petrol in America,”
– says Oleg Pendzin.
The situation with oil is a bit more complicated. According to Gennady Ryabtsev, Russia produces about 5% of the world’s oil. This volume is also not critical for the global market, but they are not going to give it up.
“No one prohibits Russia from selling oil and gas. There is only an embargo imposed by a number of countries, which, by the way, is not fully implemented. Even some EU countries and some resident companies of the British Commonwealth continue to receive Russian oil and oil products. In particular, we are talking about at least 5 refineries located in the EU. One of the branches of the Druzhba pipeline is in operation, oil terminals in Ustiluga and Novorossiysk are operating, and terminals in the Far East are in operation. China, India, Turkey, South American and African countries are actively buying Russian oil. That is, a large amount of Russian oil is present on the global market,”
– said Gennady Ryabtsev.
However, despite this, according to Podolyak, Ukraine reserves the right to destroy any Russian infrastructure used by the Russian army
“Within the framework of international law, Ukraine can ‘degrease’ Russian instruments of warfare. Fuel is the main tool. Ukraine will destroy the fuel infrastructure,”
– says the advisor to the head of the OP.
